Oil Letter

Predator Oil & Gas: Execution of Amendment Rig Contract to Drill MOU-6

(LSE: PRD) Predator Oil & Gas Holdings Plc announced the execution of an amendment to its existing rig contract with Intrepid Drilling Limited for Rig 101, extending operations for the MOU-6 well in Morocco from 1 August 2026 to 1 October 2026. The company scheduled extensive drilling and potential testing programmes to be completed over the next 3 months in Morocco (MOU-6) and Trinidad (Snowcap-3). Rig 101 is contracted to start operations after 1 August 2026, following the final delivery of remaining third-party consumables and long-lead equipment to the MOU-6 well site. The last 15 months have been spent re-building the well-delivery team using expertise from Trinidad, Morocco, Tunisia and Canada. The company receives 30% of gross sales revenues in Trinidad and can use acquired tax losses to reduce Petroleum Profit Tax from 50% to an effective rate of 12.5%. Predator Oil & Gas Holdings plc is listed on the Equity Shares (transition) category of the Official List of the London Stock Exchange's main market for listed securities (symbol: PRD). The company is committed to partnering with entities capable of supporting a future development decision and who have already identified the opportunity as one warranting the execution of a Collaboration Agreement and a Memorandum of Understanding.

Cardinal Energy Announces Second Quarter 2026 Operating and Financial Results

(TSX: CJ) Cardinal Energy Ltd. announced its operating and financial results for the second quarter ended June 30, 2026, reporting second quarter 2026 production of 25,636 boe/d, an increase of 21% compared to the same period in 2025, primarily due to crude oil production additions from the Reford 1 SAGD project. Adjusted funds flow in the second quarter of 2026 was $123.4 million, an increase of 150% compared to the same period in 2025, and net operating expenses per boe decreased 12% to $20.38/boe. Net debt was $172.7 million, a reduction of 39% from December 31, 2025 levels, and Cardinal was drawn $29.8 million or 11% of its current $275 million credit facilities at the end of the quarter. The company spent $63.6 million of capital expenditures in the second quarter, including milestone payments for the Reford 2 SAGD project, drilling and completion of two conventional oil wells, and other activities. Free cash flow of approximately $64.5 million enabled a predictable monthly dividend of $0.06 per share, with $32.2 million returned to shareholders and a 74% total payout ratio. The company projects that Reford 2 is expected to begin meaningfully contributing to corporate revenues in the fourth quarter of 2027, and management targets net debt levels well below those projected in the original 2026 capital budget released in January.

Texas Oil Tycoon Plots $5bn Saudi Oil Refinery to Break Hormuz Blockade

Texas Oil Tycoon (NYSE: TXO) has announced plans to construct a $5 billion oil refinery in Saudi Arabia, aimed at circumventing Iran's blockade of the Strait of Hormuz. This initiative is designed to enhance Saudi Arabia's refining capacity while providing a strategic alternative supply route amid rising geopolitical tensions. The refinery will process crude oil outside the critical choke point of Hormuz, addressing potential supply disruptions stemming from Iranian hostilities. For oil and energy investors, this project represents a significant opportunity to secure a more stable supply chain in a volatile region. The successful implementation of this refinery could reshape market dynamics and reduce reliance on traditional shipping routes.

Cenovus Energy Says Profits Tripled on Higher Prices, Record Oilsands Production

Cenovus Energy (NYSE: CVE) announced that its profits have tripled, attributed to higher oil prices and record production levels from its oilsands operations. The company reported significant earnings growth, reflecting a strong recovery in global oil demand as economies rebound from the pandemic. This performance not only emphasizes the resilience of Canadian heavy oil producers but also suggests a tightening supply-demand dynamic in the oil market. As Cenovus sets a strong precedent, other companies in the sector may report similar earnings, which could enhance investor confidence and drive further investment in the oil and gas industry. This trend is critical for investors as it indicates potential for sustained profitability in the sector.

Dow Leader Rides Surging Oil Prices and Trump's Venezuela Spoils

Chevron (NYSE: CVX) is experiencing significant gains as surging oil prices and potential increases in Venezuelan production reshape the energy landscape. The recent rise in oil prices is driven by geopolitical tensions and supply constraints, creating a favorable environment for crude. With Venezuela's government now more aligned with U.S. interests, the country is expected to ramp up production, which could ease global supply tightness. This development is crucial for oil and energy investors, as it may lead to improved market stability and profitability for major players like Chevron. Overall, the combination of rising prices and increased production from Venezuela presents a promising outlook for the energy sector.

Guyana’s Oil Boom Matters More Than Ever

Guyana (NYSE: GUY) is rapidly emerging as a significant player in the global oil market, with production nearing one million barrels per day, making it South America's third-largest oil producer. This surge in output comes at a critical time, as geopolitical tensions in the Middle East have created uncertainty and volatility in the oil supply chain. By injecting much-needed supply into the market, Guyana's oil boom could help alleviate some of the supply constraints that have historically driven prices higher. For oil and energy investors, this development is crucial as it may stabilize prices and offer new opportunities in a shifting landscape. The ongoing growth in Guyana’s production will likely have lasting implications for global oil dynamics.

Glencore Sees $3.3 Billion Trading Profit as Iran War Rattles Oil Markets

Glencore (LSE: GLEN) is projecting a trading profit of $3.3 billion, reflecting the heightened volatility in oil markets due to ongoing geopolitical tensions related to the Iran conflict. This anticipated profit illustrates how traders are successfully navigating price fluctuations exacerbated by fears of potential supply disruptions in an already tight market. As the situation in Iran escalates, there are increasing concerns about sanctions or military actions that could further limit oil supplies, putting upward pressure on prices. For oil and energy investors, this scenario presents both risks and opportunities, as market dynamics shift rapidly in response to geopolitical developments. The significant profit forecast from Glencore highlights the critical role that geopolitical factors play in shaping market conditions.

Calgary Oil Driller Says Its Rigs Are in Demand - up 20% - as Strong Prices Fuel Activity

Calgary Oil Driller (TSX: CPG) has reported a significant 20% increase in demand for its drilling rigs, highlighting a robust recovery in the oil market. This surge is attributed to sustained high prices that are encouraging exploration and production activities among operators. The uptick in rig utilization indicates a positive sentiment among producers and reflects the tightening supply dynamics that have been prevalent in recent months. As companies ramp up drilling efforts to take advantage of favorable pricing, an increase in crude oil output is anticipated, which could help mitigate some of the supply constraints affecting the market. This trend is crucial for oil and energy investors as it signals a potential shift towards a more balanced supply-demand landscape.

U.S. Crude Oil Inventories Increase by Million Barrels

U.S. crude oil inventories increased by 7.2 million barrels, bringing total inventories to 404.5 million barrels as of July 24, 2026, which is 7% below the five-year average for this time of year. During the same week, U.S. crude oil refinery inputs averaged 17.3 million barrels per day, a decrease of 271 thousand barrels from the previous week, with refineries operating at 97.2% of capacity. Gasoline production rose to an average of 9.9 million barrels per day, while distillate fuel production increased to 5.4 million barrels per day. The rise in crude oil inventories, despite high refinery utilization, indicates a potential oversupply in the market, which may impact oil prices and investor sentiment. This data is crucial for oil and energy investors as it reflects supply-demand dynamics and can influence trading strategies.

Exxon Stock Rises 3.3% as Oil Jumps Nearly 7%

(NYSE:XOM) Exxon Mobil (NYSE:XOM) saw its stock rise approximately 3.3% on July 29, 2026, as oil prices surged nearly 7% due to renewed military actions in the Middle East. Brent crude increased by $5.70, or 6.8%, reaching $89.79 per barrel, while West Texas Intermediate rose by $4.94, or 6.2%, to $84.20. This spike in oil prices is significant for investors as it reflects geopolitical tensions that can impact supply and demand dynamics in the oil market. Investors should monitor these developments closely, as they could influence Exxon’s production volumes and revenue potential moving forward. Overall, the market's reaction underscores the sensitivity of oil stocks to geopolitical events.

Expand Energy Outlines $750M Incremental Marketing Free Cash Flow Target as Twin Eagle is Expected to Add $200M+ EBITDA in Year 1

Expand Energy (NYSE: EXPN) has announced a target of generating $750 million in incremental marketing free cash flow, bolstered by the expected addition of over $200 million in EBITDA from its recent acquisition of Twin Eagle in the first year. This strategic initiative aims to enhance the company's production capabilities and overall financial performance. For oil and gas investors, this guidance reflects a strong commitment to growth and profitability, which could lead to increased shareholder value. The focus on free cash flow generation is particularly significant, as it underscores the company's intent to maximize returns in a competitive market. This proactive approach positions Expand Energy favorably for future opportunities.

Germany’s Uniper Firms up 20-year LNG Purchase Deal With Canada

Uniper (OTC: UNPRF) has finalized a significant 20-year liquefied natural gas (LNG) purchase agreement with Canada, securing 2 million tons of gas annually starting in 2032 from the Ksi Lisims LNG project in British Columbia. This deal, which follows a preliminary agreement made in June, is part of Uniper's strategy to diversify its gas supply sources in response to the cessation of deliveries from Russia's Gazprom in 2022. The long-term commitment underscores the growing importance of Canadian LNG in meeting European energy needs. For investors in the oil and gas sector, this agreement signals a shift towards more stable and diverse energy sourcing, potentially enhancing the resilience of European energy markets. Overall, Uniper's move reflects broader trends in energy security and supply chain diversification.

PetroChina Weighs LNG Canada Stake Sale to Fund Phase 2 Expansion

PetroChina (HKG: 857) is considering selling part of its 15% stake in LNG Canada Development Inc. to finance the planned Phase 2 expansion of the facility, which aims to double its output. This stake could be valued at a few billion dollars, and the company is looking at gradual divestment through smaller transactions. The urgency for this expansion is amplified by geopolitical tensions, especially the ongoing conflict involving Iran and the closure of the Strait of Hormuz, which poses a threat to global LNG supply. For oil and gas investors, this strategic move indicates PetroChina's commitment to enhancing its LNG capabilities in a volatile market. Overall, the potential stake sale and expansion could significantly impact the company's positioning in the energy sector.

BP Sells 15% Stake in Iraq Oil Field to Türkiye's National Oil and Gas Company

(NYSE: BP) BP has sold a 15% stake in the Rumaila oil field in Iraq to Türkiye's national oil and gas company for approximately $1.5 billion. This transaction, finalized on October 15, 2023, reflects BP's strategy to streamline its portfolio and focus on core assets while still maintaining a significant 45% interest in the field. The Rumaila oil field is one of the largest in the world, with production volumes exceeding 1.4 million barrels per day. For oil and gas investors, this divestment underscores BP's ongoing efforts to optimize its operations and manage capital efficiently, which may impact future revenue streams and investment strategies. Overall, BP's move signals a shift in focus that could influence market dynamics and investor sentiment in the sector.

Implied Volatility Surging for Occidental Petroleum Stock Options

(NYSE: OXY) Investors in Occidental Petroleum Corporation (NYSE: OXY) should closely monitor the stock as the options market indicates heightened activity, particularly with the August 21, 2026 $25 Call option showing significant implied volatility. This surge suggests that the market anticipates substantial price movement in the near future, potentially due to an upcoming event that could trigger a major rally or sell-off. Understanding these fluctuations in implied volatility is crucial for oil and gas investors, as they can signal shifts in market sentiment and potential investment opportunities. As such, keeping an eye on these developments could provide strategic insights for portfolio adjustments.

Is Marathon Petroleum (MPC) Undervalued on August 4 Earnings Hopes?

(NYSE: MPC) Marathon Petroleum (MPC) is poised for attention as it prepares to release its earnings report on August 4, 2026. The company's stock recently reached a high of US$306.05 but has seen a slight decline of 4.29% over the past week, despite a robust 30-day return of 20.46% and an impressive year-to-date increase of 85.33%. Over the last five years, long-term investors have enjoyed a remarkable total shareholder return of 516.02%. This strong performance and upcoming earnings report are critical for oil and gas investors, as they may indicate the company's ability to capitalize on favorable market conditions and refine its operations effectively. Overall, Marathon Petroleum's momentum suggests potential for continued growth and profitability in the refining sector.

Here's How SLB's Q2 Earnings Impact Energy ETFs

(NYSE: SLB) Schlumberger (NYSE: SLB) reported strong Q2 2026 earnings, with adjusted earnings per share (EPS) of 55 cents, exceeding analysts' expectations by 7.84%, although this reflects a 26% decline year-over-year. The company generated quarterly revenues of $8.97 billion, surpassing the Zacks Consensus Estimate of $8.71 billion by approximately 3% and marking a 5% increase from the previous year. Following the earnings release on July 24, 2026, SLB shares surged 11%, drawing significant interest from ETFs with high exposure to the company. This performance is crucial for oil and gas investors as it indicates resilience in the oilfield services sector amidst fluctuating market conditions. Overall, SLB's results highlight the ongoing demand for oilfield services, which could bode well for future investments in the energy sector.

Murphy Oil (MUR) Earnings Expected to Grow: What to Know Ahead of Next Week's Release

(NYSE: MUR) Murphy Oil (MUR) is anticipated to report a year-over-year increase in earnings for the quarter ending June 2026, driven by higher revenues, with results expected to be released on August 5. This earnings report is crucial for investors as it could significantly influence the stock's near-term price movement, depending on whether the actual results meet or exceed analyst expectations. Investors should pay close attention to management's commentary on business sustainability, as this will shape future earnings outlooks. A positive earnings surprise could lead to a stock price increase, while a miss may result in a decline. Overall, the upcoming earnings report is a key event for investors in the oil and gas sector.

SM Energy (SM) Earnings Expected to Grow: What to Know Ahead of Next Week's Release

(NYSE: SM) SM Energy (NYSE: SM) is anticipated to report a year-over-year increase in earnings driven by higher revenues for the quarter ending June 2026, with results expected on August 5. Investors should note that the consensus outlook suggests a positive earnings trajectory, which could influence the stock price significantly depending on actual performance relative to estimates. A strong earnings report could bolster investor confidence and lead to a stock price increase, while a disappointing report may result in a decline. This earnings release is crucial for oil and gas investors as it reflects the company's operational efficiency and market conditions, potentially impacting future guidance and investment decisions. Overall, the upcoming earnings report will be a key indicator of SM Energy's financial health and market position.

Borr Drilling Rises as Mexican JV Completes Purchase of Five Rigs for $287M

(NYSE: BORR) Borr Drilling, listed on the NYSE under the ticker BORR, has seen a positive market response following its joint venture's completion of a $287 million deal to acquire five drilling rigs in Mexico. This acquisition is expected to enhance Borr's operational capacity and revenue potential, as the company anticipates increased demand for offshore drilling services in the region. The deal aligns with Borr's strategic focus on expanding its fleet and positioning itself favorably in the competitive drilling market. For oil and gas investors, this development signals Borr's commitment to growth and its ability to capitalize on emerging opportunities in the energy sector. Overall, the successful completion of this acquisition could lead to improved financial performance and shareholder value in the coming quarters.

Cenovus Announces Second-quarter 2026 Results

(TSX: CVE) (NYSE: CVE) Cenovus Energy Inc. announced its second-quarter 2026 financial and operating results, generating approximately $5.0 billion of adjusted funds flow and $3.8 billion of free funds flow. The company delivered Upstream production of 970.4 thousand barrels of oil equivalent per day (MBOE/d), with record quarterly Oil Sands production of 786.4 MBOE/d, and Downstream crude throughput of 451.5 thousand barrels per day (Mbbls/d), representing a 95% crude unit utilization rate. Total revenues were $17.4 billion in the second quarter, up from $12.4 billion in the first quarter of 2026, and net earnings increased to $2.9 billion from $1.6 billion in the prior quarter. Cenovus returned $1.4 billion to shareholders in the second quarter, including $1.0 billion through common share repurchases and $0.4 billion through common share dividends. The company achieved its interim net debt threshold of $6 billion, with net debt at $5.4 billion as at June 30, 2026, and fully repaid the remaining $2.2 billion outstanding on the term loan facility for the MEG Energy Corp. acquisition. The company projects to achieve an Upstream monthly production milestone in excess of one million BOE/d in July and targets to return approximately 75% of excess free funds flow to shareholders while net debt is between $6.0 billion and $4.0 billion. Capital investment guidance remains unchanged at $5.0 billion to $5.3 billion.

Baker Hughes Flags Lower Spending by Oil and Gas Producers in 2026

(NYSE: BKR) Baker Hughes (NYSE: BKR) anticipates a modest decline in annual global spending by oil and gas producers in 2026, despite growth in regions like Latin America and North America land. The ongoing Middle East conflict has led to a cautious approach among producers, focusing on maximizing production from existing assets. The company reported record industrial and energy technology (IET) orders of $7.1 billion, doubling year-over-year, and shares rose over 6% following the earnings report. However, Baker Hughes warned of a potential 1%-2% revenue hit in the IET segment due to market disruptions, forecasting third-quarter revenue between $3.17 billion and $3.47 billion. This information is crucial for oil and gas investors as it highlights the impact of geopolitical tensions on spending and production strategies in the sector. Understanding these dynamics can help investors make informed decisions in a fluctuating market.

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