Report: New oil hedging contracts cover annualized 897K bbl/day of output
Seeking Alpha
Published Nov 29, 2017 11:56AM ET
Report: New oil hedging contracts cover annualized 897K bbl/day of output
- New crude oil hedging contracts during Q3 covered 897K bbl/day of annualized production, a 147% jump from Q2, according to an analysis of 33 companies by Wood MacKenzie in the biggest jump in crude hedging volumes since the energy consultancy began tracking such activity two years ago.
- “Producers that are able to lock in prices above previous expectations may feel more comfortable with increasing activity. Others may leave budgets unchanged and promote higher cash-flow guidance to an investment community anxious about profits," the firm says.
- Hess (HES +2.4%) and Cenovus Energy (CVE -1%) were the most active, accounting for 35% of volume added in the quarter, and 14 companies each added at least 25K bbl/day, typically in the $50-$60/bbl range, according to the study.
- Meanwhile, natural gas hedging slowed, with drillers adding nearly a third fewer contracts than in Q2, likely because gas prices have been less volatile this year; Range Resources (RRC +0.1%) accounted for 27% of volumes added.
- ETFs: USO, UNG, OIL, UGAZ, UWT, UCO, DGAZ, DWT, SCO, BNO, BOIL, DBO, GAZ, DTO, USL, KOLD, UNL, DNO, OLO, SZO, DCNG, OLEM, OILK, WTIU, OILX, WTID, USOI, GAZB
- Now read: Can Range Resources' 100 Trillion Cubic Feet Of Natural Gas Keep Your Portfolio Warm This Winter?
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