Silhouette of an oil pump jack.Getty Images/iStockphoto
Globe editors have posted this research report with permission of Dundee Capital Markets. This should not be construed as an endorsement of the report's recommendations. For more on The Globe's disclaimers please read here. The following is excerpted from the report:
With this publication we are actualizing our Q3 price decks, updating our forecast go forward (modestly higher WTI, tighter light oil diffs due to Line 9 reversal and lower gas with robust storage and a potential mild El Nino winter) and providing a preview for Q3 earnings across our coverage universe.
Third quarter reporting is expected to be weak across the board. Oil prices retreated and a variety of third party pipeline outages from TCPL and Alliance literally took their toll, trimming firm service and causing a run on limited interruptible capacity, which pushed gas prices negative at times (expect higher reported transportation costs and lower realized prices). On the whole, we forecast cash flow for our universe to be down 12 per cent compared to Q2 and 40 per cent YoY.
We would highlight a few bright spots, where we see SGY, TVE, TOG, and WCP poised to outperform on the quarter on organic execution and feel comfortable recommending a position in advance of earnings.
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