Oil - Service, Equipment, Pipelines etc

[winston]

Malaysia Oil & Gas

Potential trading opportunities in oil and gas

KUALA LUMPUR: Kenanga Research believes there is trading potential in oil and gas plays with palatable balance sheets and are trading at steeply discounted valuations.

"While underlying fundamentals still remain weak, we see potential trading opportunities (in contrast to fundamentally-based investment strategies) to fully capitalise on the current vaccine-driven boost in sentiment, looking to take-profit in the next 2-3 months’ window once gains are sizable," it said in a report, while maintaining its "neutral" recommendation on the sector.

The research house's top trading pick is Uzma although it also sees trading potential in Dayang and MHB.

Source: The Star

https://www.thestar.com.my/business/bus ... il-and-gas

[winston]

MY: MALAYSIA OIL & GAS
PETRONAS Activity Outlook (PAO) 2021-23 | POSITIVE

Sector Note

As expected, the PAO 2021-23 reflects a cautious, optimistic outlook for 2021, with improving positivity in 2022, based on the level of activities planned.

That said, in this latest edition, its energy transition (net zero carbon) outlook is gaining traction but we also notice a continuous decline in disclosures.

Overall, we remain POSITIVE for the sector.

Our key BUYs are Dialog, Yinson, Wah Seong, MMHE and Icon.

Source: Maybank
https://factsetpdf.maybank-ke.com/PDF/2 ... b59b39.pdf

[winston]

Malaysia Oil & Gas
Crude oil outlook for 2021 - revision
More optimistic now but …

We raise our crude oil price assumption to USD55-60/bbl for 2021 (vs. USD45-50/bbl previously).

The polar vortex disruption, vaccine optimism and production cut were the situational drivers that led to the run-up.

Higher FID activity and a more promising vaccine development would elevate optimism. That said, we remain mindful of the rising volatility, still soft demand outlook and the ongoing, underlying tension at OPEC+: – key risks.

Our key BUYs are Dialog, Icon, MMHE, Wah Seong and Yinson.

Source: Maybank

https://factsetpdf.maybank-ke.com/PDF/2 ... be86d1.pdf

[winston]

Malaysia: MIDF upgrades O&G sector to 'positive' on higher oil prices

by Tan Siew Mung

We are reassured of the Malaysian oil and gas recovery trajectory given that Petronas is now expected to increase its E&P spending in 2021 to possibly RM40 billion to RM45 billion. This is as opposed to the RM33 billion that it has spent in 2020”.

Noor Athila continued to recommend companies with strong fundamentals, stable recurring income, good business segmentation, and well-diversified revenue, such as Dialog Group Bhd (buy, target price: RM4.30), Serba Dinamik Holdings Bhd (NR) and Gas Malaysia Bhd (buy, TP: RM3.22).

For companies that are proxies to the movement in oil price, she recommended Sapura Energy Bhd (buy, TP: 16 sen) and Malaysia Marine and Heavy Engineering Holdings Bhd (trading buy, TP: 49 sen) as these companies are expected to benefit from increased E&P spending from oil majors and national oil companies should oil price continues to recover.

In terms of dividend play, she recommended Favelle Favco Bhd (buy, TP: RM3) and Petronas Gas Bhd (buy, TP:RM17.90) as these companies have been registering not only stable recurring income but also consistent dividend payout for the past three years.

Source: theedgemarkets.com

https://www.theedgemarkets.com/article/ ... oil-prices

[winston]

Singapore: Beneficiaries Of Higher Oil Prices

The recent increase in crude oil prices, due to declining global oil inventories and
better-than-expected global oil demand with the re-opening of economies after the
COVID-19 lockdowns, has triggered renewed interest in the oil & gas sector.

OPEC, together with Russia, has also helped by agreeing to a slow unwinding of supply curbs.

The immediate beneficiaries in Singapore are upstream oil producers such as RH
Petrogas and Rex International, in our view.

Source: UOBKH

https://research.uobkayhian.com/content ... 8a00bbe304

[winston]

AmResearch foresees another O&G supercycle in the making, raises crude oil forecast to US$70 for 2021-2022

by Tan Siew Mung

For direct exposure to higher crude oil prices, he recommended Hibiscus Petroleum Bhd (target price [TP]: 98 sen), which is a pure E&P operator with concessions in Malaysia, Vietnam and the United Kingdom.

He continues to like Dialog Group Bhd (TP: RM4.15) for its "resilient non-cyclical" tank terminal and maintenance-based operations.

He also likes Yinson Holdings Bhd's (TP: RM7.20) strong earnings growth momentum from the full-year contributions of floating production storage and offloading vessels Helang, off Sarawak, Abigail-Joseph in Nigeria and Anna Nery in Brazil together with multiple charter opportunities in Brazil and Africa.

He also likes Sapura Energy Bhd (TP: RM0.29) as its completed RM10 billion debt restructuring package positions the formidable engineering, procurement, construction, installation and commission (EPCIC) group to secure fresh global orders.

Meanwhile, he said Petronas Gas Bhd (TP: RM21.30) offers highly compelling dividend yields from its optimal capital structure strategy and resilient earnings base.

"Our 'sell' call is maintained on Serba Dinamik Holdings Bhd (TP: 53 sen).

Source: theedgemarkets.com

https://www.theedgemarkets.com/node/573699

[behappyalways]

BP to Exit Rosneft Stake and May Take a US$25 Billion Hit
https://www.theedgesingapore.com/news/r ... illion-hit

[behappyalways]

"A Recession Is Necessary" To Lower Demand As 'Real Economy' Routed By Soaring Fuel Prices
https://www.zerohedge.com/energy/recess ... uel-prices

[winston]

Oil & Gas – Malaysia
Petronas Capex Review: 2021 And Beyond

Petronas has revealed a yoy decrease in 2021’s local upstream capex, due to COVID-19
reasons, but international upstream capex has surged yoy.

We believe Petronas’ local O&G capex is unlikely to correlate highly with O&G prices, given its focus on overseas and green energy allocation.

The speed of local capex being ramped up may depend on resolving certain high-level issues.

Direct oil price beneficiaries may face volatility in 2H22 from interventions.

Maintain sector MARKET WEIGHT with Yinson as our top pick.

Source: UOBKH

https://research.uobkayhian.com/content ... 19b0016868

[behappyalways]

Top US Refiners Set For 652% Surge In Profits
https://www.zerohedge.com/markets/top-u ... ge-profits