Natural gas prices jumped Thursday following a multiweek swoon, providing a lift to shares of Club holding Coterra Energy (CTRA), which lately has relied on the commodity for more than half its operating revenues. U.S. natural gas prices rose nearly 4% Thursday to roughly $3.81 per million British thermal units (MMBtu). Coterra shares climbed nearly 3% to over $25 apiece. Thursday’s natural gas gains — on top of a 0.88% jump on Wednesday — reverse some of its recent losses. But only partially. As recently as Dec. 15, U.S. natural gas prices settled at nearly $7 per million British thermal units. So far in 2023, natural gas remains down around 12%. Unusually warm winter weather across the U.S. and Europe is a major culprit for the falling prices. Demand for natural gas fell in response, with less of it is needed to heat homes. Proof is in the data. The amount of working gas in storage actually rose 11 billion cubic feet in the week ended Jan. 6, the U.S. Energy Information Administration said Thursday. That’s the first weekly inventory build in January on record, according to FactSet. Of course, the price of natural gas matters to consumers and their energy bills. It also matters greatly to investors in Houston-based Coterra, the product of a 2021 merger between Cabot Oil & Gas and Cimarex Energy. Coterra has the most natural gas exposure of the three exploration and production (E & P) firms in the Club portfolio, with the commodity accounting for nearly 58% of its operating revenue through the first three quarters of 2022; fourth-quarter results aren’t out yet. Pioneer Natural Resources (PXD), by contrast, has generated 11% of its operating revenue from natural gas over the same span. That figure is roughly 14% for Devon Energy (DVN). Oil and natural gas liquids are the other major products all three E & P companies sell. In a very basic sense, the higher the price of natural gas, the more money Coterra can make from its operations — which ultimately influences the company’s free cash flow and, by extension, its dividend payment. But the company’s realized price in a quarter can be different than the average market prices over that same timeframe. This is because companies like Coterra will enter into agreements to sell natural gas or oil at a predetermined price at a future date. Sometimes, that agreed-upon price will be higher than the market price on that day. Other times, it will be lower. This is what determines the difference between a company’s realized price and the spot price of the commodity in question. Coterra investors still pay attention to the swings in natural gas prices. The company’s sales are not fully hedged, so what happens to market prices does impact the amount of revenue it generates. In an interview with Jim Cramer earlier this week, Coterra CEO Tom Jorden sought to downplay worries about natural gas price declines. “Prices are constructive on both oil and gas, and our returns are really extraordinary at current conditions,” he said Tuesday night. The Club and other shareholders care a great deal about those returns. Coterra employs a fixed-plus-variable dividend, so the payout changes quarterly based on the company’s free cash flow in the trailing three months. The company has committed to returning at least 50% of its free cash flow each quarter to shareholders. Including dividends and stock buybacks, Coterra returned 74% of free cash flow in the third quarter and 80% in the second quarter. At Wednesday’s closing price of $24.69 per share, Coterra’s dividend yield stood at roughly 11%, based on its most recent payout of 68 cents on Nov. 30 . “We can never predict the price going forward, but we can control being good at the business, being disciplined in our investments and managing a prudent, healthy balance sheet,” Jorden told Jim. No doubt, predicting the price of volatile commodities is a tough task. But agencies and research firms still do so. In its short-term outlook issued Tuesday, the U.S. EIA forecasted natural gas prices to average $4.90 per MMBtu this year, down nearly 10% from its prior projection of $5.43. Through the first nine months of 2022, Coterra’s realized natural gas price was $4.79 per MMBtu. This is notable because even though natural gas soared to over $9 per MMBtu at times in the spring and summer of last year, Coterra’s realized sale price wasn’t nearly as high as market prices. This helps explain why the Club hasn’t run for the hills as natural gas prices fell in recent weeks. Volatility is to be expected, and we know Coterra is able to maintain a very attractive dividend even if commodity prices are a bit lower than where they were in 2022. In a very uncertain market environment, being invested in companies that return significant capital to shareholders is a good place to be. Jim said Wednesday morning he believed Coterra was worth buying at current levels, due in part to reassurances Jorden provided on recent reserve write-downs at the company. Elsewhere in energy, the Club trimmed its position in oilfield services Halliburton (HAL) on Thursday. While we still like the stock overall, we wanted to be disciplined due to its recent strength and book some profits. (Jim Cramer’s Charitable Trust is long CTRA, DVN, PXD and HAL . See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
Pipes at the landfall facilities of the ‘Nord Stream 1’ gas pipeline are pictured in Lubmin, Germany, March 8, 2022.
Hannibal Hanschke | Reuters
Natural gas prices jumped Thursday following a multiweek swoon, providing a lift to shares of Club holding Coterra Energy (CTRA), which lately has relied on the commodity for more than half its operating revenues.
LiveWire, the electric motorcycle brand spun out of Harley-Davidson, has just announced its latest electric motorcycle model. The new LiveWire S2 Alpanista is built on the same platform as the brand’s last two models, leveraging the Arrow platform as a versatile foundation for several diverse bikes.
The Arrow platform first received its debut with the LiveWire S2 Del Mar, which was then followed by the S2 Mulholland.
LiveWire announced that a high-performance electric maxi-scooter would be produced on the Arrow platform, but not before the company rolled out the S2 Alpinista. “The Alpinista is LiveWire’s first sport standard,” explained the company, “equipped with 17” wheels and tires, blending the best of street, sport, and hyper-tourer characteristics.”
The recently unveiled S2 Alpinista is mechanically quite similar to the two previous models sharing the platform. The 10.5 kWh battery that serves as the main structure of the bike will offer a maximum range of 120 miles (193 km) per charge under city riding conditions. It can be recharged with a Level 2 charger from 20-80% in just 1 hour and 20 minutes.
The 433 lb (196 kg) bike can achieve a 0-60 mph (0-96 km/h) time of just 3.0 seconds, thanks to its powerful 63 kW (84 hp) motor. The S2 Alpinista can also reach an electronically limited top speed of 99 mph (159 km/h).
Priced at US $15,999 and already available at LiveWire dealerships in North America and Europe, the S2 Alpinista officially becomes the most affordable LiveWire electric motorcycle available to date, undercutting the $16,249 S2 Del Mar electric street tracker and the $16,499 Mulholland electric sport cruiser.
“Alpinista reimagines the S2 by combining the urban agility of a supermoto with the do-it-all nature of a touring bike, creating a practical and thrilling sport standard,” explained the brand.
The smaller 17″ wheels help reduce the seat height of the bike, and combined with the Dunlop Roadsmart IV tires, the street-optimized bike is ideal for “both daily commutes and spirited rides through winding roads.”
The S2 Alpinista comes with 6-axis IMU from Bosch providing cornering-enhanced antilock braking and cornering-enhanced traction control systems, in addition to four preset ride modes and two custom modes.
Now the third model launched on the Arrow platform, the S2 Alpanista underscores the versatility of LiveWire’s workhorse. The approach was intended to allow the e-motorcycle offshoot to quickly innovate with multiple styles of motorcycles all sharing key structural and drivetrain components. The move has largely been seen as an engineering success, with three models hitting the road in under three years. However, sales have yet to reach targets set by LiveWire as the more premium electric motorcycle industry has experienced a rocky few years.
As a LiveWire S2 Del Mar owner myself, I can attest to both the performance and enjoyable experience of bikes built on the platform, though I do find myself in a somewhat smaller community than LiveWire had likely hoped for. With the backing of its powerful older brother H-D, which retains a controlling stake in the company, LiveWire has enjoyed the relative freedom to cruise for its first few years and focus on motorcycle development and rollouts, with profitability hopefully coming over the horizon in due time.
FTC: We use income earning auto affiliate links.More.
British oil and gasoline company BP (British Petroleum) signage is being pictured in Warsaw, Poland, on July 29, 2024.
Nurphoto | Nurphoto | Getty Images
British oil major BP on Thursday said it is planning to cut thousands of jobs as part of a major cost-reduction exercise.
“Today, we have today told staff across bp that the proposed changes that have been announced to date are expected to impact around 4700 bp roles – these account for much of the anticipated reduction this year,” BP said in a statement.
“We are also reducing our contractor numbers by 3000,” the company said.
The measures, which were designed to lower costs, come after BP CEO Murray Auchincloss said last year that the company intends to deliver at least $2 billion of cash savings by the end of 2026.
BP’s workforce currently stands at around 87,800.
Shares of the company traded 1.4% higher on Thursday morning.
Strategy in focus
BP has underperformed its European rivals of late as energy market participants continue to question the firm’s investment case.
In a trading update published Tuesday, BP said weaker refinery margins and turnaround activity will deliver a $100 million to $300 million blow to its fourth-quarter profit, while further declines are expected in oil production.
The energy firm is scheduled to report quarterly and full-year earnings on Feb. 11.
BP said in the same update that it had postponed an event for investors next month so that its chief executive can fully recuperate from a “planned medical procedure.” Auchincloss was said to be “recovering well” from the procedure, which had not been previously disclosed.
The capital markets event, which had previously been scheduled to take place in New York on Feb. 11, will now take place in London on Feb. 26.
— CNBC’s Ruxandra Iordache contributed to this report.
On today’s episode of Quick Charge we explore the uncertainty around the future of EV incentives, the roles different stakeholders will play in shaping that future, and our friend Stacy Noblet from energy consulting firm ICF stops by to share her take on what lies ahead.
We’ve got a couple of different articles and studies referenced in this forward-looking interview, and I’ve done my best to link to all of them below. If I missed one, let me know in the comments.
New episodes of Quick Charge are recorded, usually, Monday through Thursday (and sometimes Sunday). We’ll be posting bonus audio content from time to time as well, so be sure to follow and subscribe so you don’t miss a minute of Electrek’s high-voltage daily news.
Got news? Let us know! Drop us a line at tips@electrek.co. You can also rate us on Apple Podcasts and Spotify, or recommend us in Overcast to help more people discover the show.
FTC: We use income earning auto affiliate links.More.