Midstream stocks rise
Top midstream stocks continued to rise for the second week in a row last week. Enterprise Products Partners (EPD), Williams Companies (WMB), and ONEOK (OKE) each rose more than 3% last week. Magellan Midstream Partners (MMP) and Energy Transfer (ET) rose more than 2% each. The Energy Select Sector SPDR ETF (XLE), which tracks the performance of S&P 500 energy stocks, fell 0.1% in the week.
The above graph compares the performance of selected midstream stocks in the last week. Crude oil prices rose ~0.9% in the last week. Kinder Morgan (KMI) underperformed its peers with just a 0.2% rise for the week. On March 22, J.P. Morgan downgraded Kinder Morgan from “overweight” to “neutral.” The stock fell 2.5% on that day.
EPD’s crude exports
On March 20, Enterprise Products Partners announced an electronic auction of crude oil for export from the Houston Ship Channel. The company will carry out the auction with CME Group. Enterprise Products carried out the first such auction in November 2018.
Brent Secrest, Enterprise Products’ senior vice president of commercial, noted, “With the recent success of the first ever electronic auction of U.S. crude oil for export, the market has demonstrated its demand for transparency, efficiency, accurate physical pricing and access to reliable supplies of crude oil with consistent quality standards.” Enterprise Products Partners accounts for ~40% of the total US crude oil exports.