SPDR® S&P Oil & Gas Explor & Prodtn ETF

On October 27, Antero Resources Corporation announced the initial public offering of Antero Midstream Partners LP.

The availability of takeaway capacity from the Bakken can affect producers’ earnings.

Antero Resources’ current acreage is focused in the Marcellus Shale in West Virginia and the Utica Shale in Ohio.

Chevron Corporation is currently trading at EV-to-2014E EBITDA of 5x, has an approximately $239 billion market cap, and ~$245 billion enterprise value.

Mild weather and rising inventory estimates could drag natural gas prices lower. The key support for natural gas prices is seen at $2.60 per MMBtu.

Wall Street analysts gave mixed recommendations after Apache’s quarterly results. Apache shares fell 5% on November 6, 2015, after the earnings release.

Marathon Oil (MRO) has seen a strong rally in the past month. The company has risen ~15% from its lows of $19 in August.

At 6:05 AM EST on March 19, the West Texas Intermediate crude oil futures for May 2018 delivery were trading at $62.20 per barrel—a drop of 0.34%.

For most of the last two years, WTI crude oil has been range-bound between ~$85 per barrel and ~$110 per barrel.

In the seven calendar days to February 8, 2018, OIH, XOP, XLE, and AMLP fell 13.6%, 12.7%, 11.8%, and 8.2%, respectively.

Petrobras (PBR) is expected to post its 3Q16 results on November 10, 2016. In 2Q16, it had adjusted EPS of $0.03 compared to analysts’ estimates of $0.12.

Natural gas production from the lower 48 states of the US increased slightly by 0.6% to 79.82 Bcf as of May 20, 2015—compared to the previous week.

Tesoro (TSO) noted a contraction in its GRM (gross refining margin) by $10.4 per barrel YoY (year-over-year) to $9.1 per barrel in 3Q16.

Issuance slowed to a trickle when market conditions were unfavorable in August. A number of transactions were either postponed, re-priced, or withdrawn from the market altogether. There was an increase in high-yield debt risk perceptions.

Natural gas prices in the northeastern US have increasingly been below the Henry Hub price. This is primarily because of the Northeast’s increased access to Marcellus natural gas production.

On December 24, the US Energy Information Administration (or EIA) released its crude inventory report for the week ended December 19.

Oasis Petroleum (OAS) is expected to release its fiscal 2Q16 earnings on August 3, 2016. Oasis Petroleum’s 2Q16 revenue estimates are lower than its revenue for the previous quarters.

ConocoPhillips (COP) announced its 4Q17 earnings on February 1, 2018, before the market opened. It had better-than-expected profits of ~$540 million, beating analyst expectations.

Hess (HES), Apache (APA), Devon Energy (DVN), and Marathon Oil (MRO) recorded lower 4Q15 revenues compared to the corresponding quarter in 2014.

Phillips 66 (PSX) posted its earnings on July 29, 2016. On the day, PSX’s implied volatility fell by 5% to 23.2 compared to the previous day.

Crude oil’s (USO) (DBO) (USL) (OIIL) implied volatility was 26.6% on April 28, 2017, which was 4.6% above its 15-day average.

Despite COG’s recent negative stock market movement, the fact that it was able to hold its own and sustain significant levels of production should ensure that it maintains relatively high stock market returns.

The EIA released its weekly crude oil inventory report on September 28, 2016. US crude oil inventories are near January 2016 levels.

Occidental Petroleum (OXY) is set to report its 4Q17 and fiscal 2017 earnings on February 13, 2018. For 4Q17, OXY’s current consensus net income estimate is ~$275.0 million.

Shares of USO trade on the NYSE like company stock. The fund lost ~5.3% in the week ended July 2.

On Friday, June 5, Baker Hughes released the weekly natural gas rig count report. As expected, natural gas rigs fell by three to 222 for the week ending June 5.

In the trailing week, OIH rose 0.5%—the only energy ETF on our list that closed in the green. US crude oil futures rose 2.6%.

Natural gas prices directly affect earnings for gas-weighted producers such as Chesapeake Energy Corporation (CHK), EQT Corporation (EQT), Southwestern Energy Company (SWN), and Range Resources Corporation (RRC).

The unexpected fall in crude oil inventory supported crude oil prices. The fall in US imports might have led to the fall in the US oil inventory.

Marathon Oil’s stock price fell from $15.91 to $15.16 last week, while crude oil prices fell from $53.18 per barrel to $49.62 per barrel.

The key support level for natural gas is seen at $2.50 per MMBtu. Prices hit this mark multiple times in April 2015. Resistance is seen at $2.75 per MMBtu.

Natural gas prices continued their declining trend from last week due to mild weather forecasts on the East Coast from December 13 through December 22.

Crude oil continues to trade higher due to positive sentiment surrounding the crude oil market. At 7:38 AM EST, WTI crude was trading at $44.88 per barrel.

Rising refinery utilization and declining US output will support crude oil prices. This is positive for crude oil prices.

September natural gas futures contracts rose for the third day in a row. Natural gas prices have been trading close to the key resistance of $2.90 per MMBtu.

In 3Q15, Occidental Petroleum production mix was 63% crude oil, 25% natural gas, and 12% NGLs. This means that it is more tilted toward liquids production.

The analyst survey shows that nine out of the 12 companies surveyed rated Marathon Petroleum (MPC) as a “buy,” “overweight,” or “outperform.”

Among the energy ETFs, the Energy Select Sector SPDR ETF (XLE) had the highest correlation with US oil (UCO) (USO) prices at 78.7% between May 11 and May 18, 2017.

Although pipelines are the cost-effective way to transport crude oil, they require huge initial investment and are often impeded by regulations from the government agencies.

Every week, the U.S. Energy Information Administration (or EIA) reports figures on natural gas inventories, or the amount of natural gas stored in facilities across the U.S.

Natural gas futures for July delivery slumped by 4.95% on Thursday. Natural gas prices declined due to rising inventory data. It continued its losing streak.

Oasis Petroleum’s (OAS) total 1Q16 production volume was 50,315 boepd (barrels of oil equivalent per day). This represents a flattish year-over-year growth.

For 4Q16, Wall Street analysts expect Murphy Oil to report EBITDA of ~$261 million—compared to adjusted EBITDA of approximately -$122 million in 4Q15.

Devon plans to rapidly grow production in the Eagle Ford over the next few years.

Natural gas producers will see upside from the colder winter, as it has helped to boost natural gas prices.

Apache (APA) is expected to release its 2Q16 earnings on August 4, 2016. Its revenue estimate is $1.3 billion. That’s 33% lower than 2Q15 and 26% higher than 1Q16.

Valero Energy (VLO) released its fourth quarter earnings on January 29. The company reported a net income of $1.2 billion.

Removing companies that outperformed on account of pending acquisitions, the top-performing energy company in the upstream or integrated segment is XOM. This isn’t a surprise.

On March 28, 2017, WTI (West Texas Intermediate) crude oil active futures were trading at a discount of $2.96 per barrel to Brent crude oil active futures.

Concho Resources and Pioneer Natural Resources have the most “buy” recommendations as compared to peers at 82% and 93%, respectively.

Let’s examine CVX’s valuation trend. CVX traded at an average PE of 11.7x from 1Q13 to 3Q15. The PE measures a company’s price per share as a multiple of EPS.

While retail investors don’t have easy access to the futures market, they can benefit from access to safer, low-cost avenues such as energy ETFs to bet on WTI crude prices.

Baker Hughes will release the weekly crude oil rig count report on July 24, 2015. The crude oil rig count fell by seven to 638 for the week ending July 17.

The Gulf of Mexico rig count was down by 11 rigs compared to the previous week, with 35 rigs for the week ending March 20, 2015.

The long-term oversupply concerns could drag natural gas prices lower. The key support for natural gas prices is seen at $2.60 per MMBtu.

On April 5, 2017, active natural gas (UNG) (FCG) (BOIL) (GASL) futures were trading at a premium of $0.33 to futures contracts 12 months forward.

March WTI (West Texas Intermediate) crude oil (ERX) (IEZ) (USO) (PXI) futures contracts fell 1.6% and settled at $52.17 per barrel on February 7, 2017.

The OCTG segment has been hit hard by lower demand and higher inventory. This would put pressure on U.S. Steel (X) and Nucor’s (NUE) tubular operations.

The weather is the major driver of natural gas prices, so investors can get an idea of how prices will likely move in the short term.

In the week starting on March 26, 2018, Legacy Reserves LP increased from last week’s close of $4.47 to $4.94 on March 26—an increase of ~11%.

More U.S. gas exports creates more demand for U.S. natural gas, which supports prices and incentivizes greater production. This is positive for upstream producers.

On October 3, 2017, US crude oil (USL) (OIIL) November 2018 futures settled $0.33 higher than the November 2017 futures.

Another key reason behind why investors have kept Chesapeake Energy (CHK) in their sights is its significant steps towards debt reduction and management.

Wall Street analysts gave target prices for Marathon Oil after its 2Q15 financial results. Evercore ISI gave Marathon Oil a target price of $23.

On October 24, 2017, Brent crude oil (BNO) active futures were $5.86 above WTI crude oil active futures.

October natural gas futures contracts rose by 0.86% on September 24. Natural gas prices rose despite a larger-than-expected rise in the natural gas inventory.

July WTI crude oil futures trading on NYMEX showed the rectangular trading range pattern. Prices have been fluctuating between $58 and $61 per barrel for a few weeks.

On March 19, US crude oil May futures fell 0.4% and settled at $62.13 per barrel. US crude oil May futures made a high of $62.44 per barrel.

Between December 29, 2017, and January 8, 2018, the premium and the oil prices rose. The market expects a tightening supply-demand balance for oil in 2018.

May natural gas futures fell by 4.47% and settled at $2.52 per MMBtu on April 9, 2015. Natural gas prices plunged because of the massive inventory buildup.

Cabot Oil & Gas (COG) had the highest correlation with natural gas prices in the past one-year, six-month, three-month, and one-month periods.

On Thursday, September 3, 2015, natural gas prices rallied due to speculation of an increase in demand for natural gas as a result of the warm weather forecast.

On April 24, 2017, natural gas futures (UNG) (BOIL) (FCG) contracts for June 2017 delivery closed at $3.16 per MMBtu (million British thermal units).

On December 5, 2017, the January 2018 futures contract for US crude oil settled at a premium of $2.5 to January 2019 futures.

September natural gas futures contracts fell by 4.91% on August 13, 2015. Prices fell due to a better-than-expected rise in natural gas inventory data.

On November 2–9, the SPDR S&P Oil & Gas Exploration & Production ETF (XOP) rose 0.6%—the least among major energy ETFs.

On January 2, 2018, natural gas (UNG) (BOIL) (FCG) February 2018 futures settled $0.025 less than February 2019 futures.

Exxon Mobil alleged that the Venezuelan government illegally expropriated its Venezuelan assets in 2007 and paid unfair compensation.

Natural gas futures for May delivery rose for the second day by 1.20% and settled at $2.60 per MMBtu on April 22, 2015.

NYMEX-traded June natural gas futures increased by 1.62% on Monday—led by the consensus of warm weather estimates. Prices rose for the fifth consecutive day.

The EIA reported that US crude oil production increased by 100,000 bpd (barrels per day) to a record high of 10.9 MMbpd on June 1–8.

On November 12–19, the SPDR S&P Oil & Gas Exploration & Production ETF (XOP) fell 1.6%—the largest decline among major energy ETFs.

Natural gas futures contracts for October delivery fell by 1.04% on September 25, 2015. Natural gas prices fell due to oversupply concerns.

October natural gas futures contracts fell by 2% and settled at $2.64 per MMBtu (British thermal units in millions) on September 2, 2015.

August US crude oil futures contracts rose 2.5% and closed at $46.04 per barrel on June 30. Brent crude oil futures rose and settled at $47.92 per barrel.

NYMEX-traded natural gas for May increased by 1.54% on April 21, 2015. Prices increased due to cold weather estimates. This could increase the demand for natural gas.

According to the EIA’s report on July 18, US crude oil inventories rose by ~5.8 MMbbls to ~411.1 MMbbls in the week that ended on July 13.

On March 1, 2017, active natural gas (UNG) (FCG) (BOIL) (GASL) futures were trading at a discount of $0.5 to futures contracts 12 months ahead.

Brent crude oil prices could fall as low as $40 per barrel by the end of 2017 if OPEC doesn’t extend major producers’ production cut deal in 2H17.

The EIA estimates that US distillate inventories fell 0.8 MMbbls (million barrels) to 138.0 MMbbls from September 15–22, 2017.

Natural gas prices rose for the sixth time in the last ten days. Prices rose by 0.05% more on the up days than on the down days.

In 3Q15, Occidental Petroleum production was 689,000 BOE per day, which is higher by almost 16% than its 595,000 BOE per day in 3Q14.

The representative NGL barrel reached highs of up to ~$50 per barrel in early February, given the strength in propane prices due to a cold winter as well as natural gas prices that pushed ethane prices up.

On August 15, Brent crude oil active futures were trading $3.25 more than the WTI crude oil active futures. On August 8, the spread stood at $2.97.

WTI crude oil (BNO) (PXI) (UCO) (XOP) prices have fallen 18% year-to-date. They have fallen 7% in the past year due to bearish drivers.

UNG was underperforming natural gas for almost the entire week, but towards the end of the week, it gave slightly higher returns.

Crude oil (USO) (IXC) (XES) was trading near a 20-month high on March 7. US crude oil prices posted their biggest one-day decline in the last 13 months.

Wood Mackenzie research shows that the oil majors have deferred more than 45 significant oil and gas projects since the beginning of the crude oil price collapse last year.

Continental Resources’ (CLR) current implied volatility is 35.4%. That’s about 9.0% lower than its 15-day average of 40.0%.

On May 16, 2017, the API will release its weekly crude oil inventory report. A fall in crude oil inventories could support US crude oil (BNO) (PXL) prices.