Baker Hughes (BHI) reported that the US crude oil rig count decreased by 31 for the week ending April 24—compared to the previous week.
Last week’s lower rig count was due to 31 fewer active crude oil rigs. The drop in oil rigs was partially offset by the addition of eight natural gas rigs.
The US rig count generally experienced an uptrend throughout the most of 2014. However, that trend reversed in the past five months.
May natural gas futures broke down the symmetrical triangle pattern on April 27, 2015. Warm weather estimates drove natural gas prices lower on Monday.
The increase in power generation from nuclear power plants will impact natural gas and coal prices. Their demand will drop due to a decline in heating needs.
NYMEX-traded May natural gas futures dropped by 1.62% on Monday. Natural gas prices hit a three-year low and settled at $2.49 per MMBtu on April 27, 2015.
Natural gas futures for May delivery have been trading within the downward channel since mid-February. The current momentum is bearish for natural gas prices.
On Friday, Baker Hughes (BHI) reported that the US natural gas rig count increased by eight to 225 for the week ending April 24. It increased by 3.7% week-over-week.
Natural gas futures for May delivery settled unchanged at $2.53 per MMBtu on April 24, 2015. The EIA released the natural gas weekly report on April 23.
Arch Coal surprised the markets with track record on the cost savings front. However, the pricing for both metallurgical and thermal coal remains weak.
Arch Coal has no major maturing obligations until 2018, when $1.9 billion of debt matures, followed by $1.7 billion in 2019, $500 million in 2020, and $1.1 billion in 2021.
Arch Coal reported adjusted EBITDA of $81.8 million in 1Q15, compared with $27.6 million in 1Q14. Despite lower revenues, the adjusted EBITDA improved due to cost savings.
The company showed remarkable cost performance at the Appalachian segment, and the cash costs in this segment were lowest in the last four years.
During 1Q15, Arch Coal shipped 3 million tons of Appalachian coal, including 1.5 million tons of met coal and an equal quantity of Appalachian thermal coal.
Last week, total US natural gas consumption decreased by 1.7% week-over-week. Consumption declined in the residential and commercial sectors by 5.2%.
Continued production growth set a grim scenario for natural gas prices. High production levels are bearish for natural gas prices.
After seeing the biggest weekly gain since February last week, natural gas prices plunged in the week from April 20–24. Natural gas prices closed at $2.53 MMBtu.
The EIA’s Natural Gas Weekly Update for the week ending April 17 showed that stocks increased by 90 Bcf to 1,629 Bcf. Analysts were expecting an increase of 86 Bcf.
Halliburton (HAL) released its 1Q15 financial results on April 20. The company recorded total revenues of $7.05 billion for 1Q15, down 4.1% from 1Q14.
Approximately 72% of Wall Street analysts tracking Halliburton (HAL) rate it a “buy” or some equivalent.