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Q2 2019 Energy Quarterly Review
Noble Capital Markets
It was a difficult quarter for energy stocks as prices fell in response to falling energy prices. Energy stocks, as measured by the XLE Energy Select Sector SPDR Fund, fell 5.1% over the three months ended June 30, 2019. The decline stands in contrast to a 2.6% increase in the S&P 500 Composite Index over the same time period. Both oil and natural gas prices declined during the most recent quarter. Oil prices, as measured by the WTI August 2019 future price, declined 5.4% from $61.81 per barrel to $58.47 per barrel. Natural gas prices, as measured by Henry Hub August 2019 futures, declined even more significantly, falling 14.0% from $2.68 per thousand cubic feet to $2.308.
The decline in oil prices corresponds to rising inventories with the EIA reporting consolidated oil stocks of approximately 2 million BBLS (as of 6/21), up 4.6% from a year ago. Oil imports continue to decline even as the export of petroleum products grows. Domestic production of oil continues to grow. The spread between North Sea Brent oil prices and WTI oil price has...
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