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Texas Pacific Land announces a rise in profit for the quarter on higher royalties
Texas Pacific Land announced a higher core profit for the second quarter on Wednesday as higher royalties revenues offset lower oil prices. The results are coming as the energy sector braces itself for the impact of U.S. president Donald Trump's proposed tariff plans that have weakened oil prices and caused concern about global demand. The company earns money from land usage fees, construction materials sales, water treatment or sourcing services, and oil and natural gas royalty interests. The total revenue for the second quarterly increased from $172.3 to $187.5 millions, largely due to a 6% increase in oil and natural gas royalties. Brent crude was 20% lower than the previous year's second quarter, mainly due to U.S. Tariffs, their impact upon global economic growth, and increased OPEC+ production. Texas Pacific's average realized oil price for the third quarter was $63.99, a decline of 21% from $80.93 per barrel realized last year. The company reported net income of $116.1 millions, or $5.05 a share, for its second quarter ending June 30. This compares to $114.6millions, or $4.98 a share, one year ago. (Reporting from Vallari Srivastava in Bengaluru, Sumit Saha in New Delhi and Katha Kaalia in Bengaluru. Editing by Mohammed Safi Shamsi.)
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CRH expects the US market for low carbon cement alternatives to double by 2050
The head of the U.S.'s largest building materials manufacturer, CRH, said that the market for supplementary cementeditious materials, a low carbon alternative to cement, will double by 2050. CRH's CEO Jim Mintern said this after the industrial giant announced a better-than-expected 9% increase in its second quarter core profits and forecasted full-year earnings between $7.5 billion and $7.7billion, compared to a previous range of $7.3billion to $7.7billion. Last month, the Irish-based U.S. listed firm agreed to purchase U.S. SCM Supplier Eco Material Technologies for $2.1 Billion to meet the growing demand for alternative ash-based materials. Mintern stated that "we were attracted to the deal" because we believe that the SCM industry in the U.S. will double by 2050. This deal places us at the top of the list in terms size and leadership in America (and) provides us with a good growth platform." He added that the acquisition would increase CRH's ability to serve the US SCM market, which has a capacity of 135 million metric tons. CRH is North America's third largest cement producer. CRH's adjusted second quarter earnings before interest tax, depreciation, and amortization (EBITDA), of $2.5 billion, were higher than the $2.4 billion average expected by seven analysts polled in LSEG SmartEstimate. Mintern stated that the higher end of the full-year guidance range is based on the trading in July, a seasonally important month, and an increase year-over-year in volume and margins for contracted work across the major U.S. products lines. (Reporting and editing by Chris Reese; Padraic Hlpin)
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Brazil's iron ore exports in July hit a record volume
Official data released on Wednesday showed that Brazil exported 41.1 millions metric tons (metric tons) of iron ore during July, breaking its previous record of 39.5 million tons, set in December 2015. Why it's important Brazil is the second largest exporter of iron after Australia. Brazil exports iron ore, along with soybeans and oils. Brazil reported a trade surplus of $7.1 billion for July, a 6.3% decline from the previous year. By the Numbers Brazilian iron ore exports, led by Vale, grew 4.7% from July last year. However, revenues fell 8.8%, to $2.62billion, as prices dropped about 13%. KEY QUOTE In a recent statement, the Brazilian mining lobby group Ibram stated that "June-July saw a rebound in confidence in the sector because of the progress of major projects in China and the resumption in production." Ibram noted that this was one factor which may have contributed to the increase in global prices since late June. (Reporting and writing by Roberto Samora, Editing by Sarah Morland & Leslie Adler; Writing by Andre Romani)
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General Matter signs lease agreement with US Department of Energy to enrich Uranium
General Matter, an American startup that hopes to enrich uranium to fuel nuclear reactors, has signed a lease agreement with the Department of Energy to build a facility in a former federal factory in Kentucky. The project, which will cost $1.5 billion, will be located at the former Paducah gaseous diffusion plant. In the 1950s, the U.S. constructed the site to produce enriched Uranium initially for nuclear weapons. Later, the facility produced enriched Uranium for nuclear reactors. It closed in 2013. DOE stated that construction is scheduled to start in 2026 and enrichment operations will begin before the end of the decade. The company estimates that the plant will create 140 permanent jobs. Scott Nolan, CEO of General Matter, said that reactivating this site would "power an era of American independence in energy." General Matter hosted a ceremony at Paducah, attended by Kentucky Governor Andy Beshear and U.S. Senators and Representatives, as well as DOE officials. The company has not stated how much enriched Uranium it will be producing. The U.S. relies heavily on foreign suppliers including Russia, even though Urenco, based in the UK, has the capacity to meet about a third (or more) of the U.S. needs for enriched uranium. The former president Joe Biden imposed a ban on Russian imports of enriched uranium that allowed waivers up until 2028. General Matter is among several companies who have received DOE grants for the production of both low-enriched or LEU and a special fuel known as high-assay, low-enriched or HALEU. These companies must obtain licenses from Nuclear Regulatory Commission. HALEU may be used for high-tech reactors, which are expected to begin operating in 2030. General Matter has not revealed the technology that it will use to enrich the uranium nor the funding for the project. The company said that it "incubated" the project within Founders Fund - a venture capital firm in which Nolan was a partner. The DOE stated that the lease will provide General Matter with at minimum 7,600 cylinders uranium fluoride fuel to be used for enriching into reactor fuel. The DOE claims that the process will save Americans $800 million by avoiding disposal costs. Global Laser Enrichment (a company owned jointly by Silex Systems, Cameco, and Cameco) is also planning to enrich uranium at Paducah. It was one of the six companies that were awarded initial U.S. government contracts for domestic uranium production. It will use lasers instead of centrifuges to enrich uranium. Nima Ashkeboussi said, "From the standpoint of technology readiness and regulatory timeline, nobody is going to get a NRC license faster than us." GLE intends to enrich waste byproducts or tailings from DOE's enrichment program. General Matter stated that the "vast" majority of the uranium they will enrich will come from domestic sources. It said that the DOE reserves tailings to enrich uranium in case of a shortage.
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Wall Street gains as oil trades lower and ends in volatile volatility
Wall Street indexes rose on Wednesday, boosted by a slew of positive corporate earnings. U.S. Yields also increased, but European shares ended flat, ending a two-day streak of gains. The U.S. president Donald Trump issued a executive order that imposed an additional 25% tariff for goods coming from India. He claimed the country had imported Russian oil. The oil prices sawsawed up and down as Trump's comments about progress in negotiations with Moscow caused uncertainty over whether the U.S. will impose new sanctions against Russia. The MSCI index of global stocks rose by 0.65% to 932. Apple shares rose after the news that it would announce its domestic manufacturing pledge. The Nasdaq Composite was also up 1.21% at 21,169.42. The Dow Jones Industrial Average increased 0.18% to 42,193.12 while the S&P 500 grew 0.73% to 6345.06. Earnings have a mixed response. "Earnings are seeing a mixed reaction. The STOXX 600 Index in Europe closed 0.06% down, with healthcare stocks dragging it down after Trump announced his tariff plan for pharmaceuticals. The broadest MSCI index of Asia-Pacific stocks outside Japan fell by 0.08%, closing at 654.33, while Japan’s Nikkei gained 0.60%, reaching 40794.86. Wall Street closed down on Tuesday, after data revealed that the services sector activity had unexpectedly plateaued in July. The markets increased their bets that the Federal Reserve will cut rates in September after the soft data on Friday. Samy Chaar is the chief economist of Lombard Odier. He said that there's a tug-of war between the concrete signs we have seen that show the U.S. economic slowdown and the fact that rates are going down, which will remove some pressure on valuations. The focus of traders has been on the tariff impact. "The market is focusing more on the fact we're getting moderate tariffs. But I wonder if they aren't paying enough attention to the fact we could still be getting more, like pharmaceuticals," Chaar said. Trump said on Tuesday that he will announce tariffs on chips and semiconductors in the coming week. The U.S. will initially impose a'small tariff' on pharmaceutical imports, before increasing the tariff substantially over the next year or two. He said that the U.S. and China were close to a deal on trade, and he planned to meet with his Chinese counterpart Xi Jinping by the end of this year if a deal was reached. Brazil has submitted a request for consultation at the World Trade Organization regarding U.S. Tariffs. Treasury yields have gained on the government bond markets. The yield on the benchmark 10-year U.S. notes increased 3.4 basis points from late Tuesday to 4.23%. The yield on benchmark German 10-year Bunds increased 0.2 basis points from late Wednesday to 2,644%. FedWatch from the CME shows that Fed funds futures indicate a 94% probability of a rate reduction next month. At least two cuts are priced in this year. Investors await Trump's choice to fill the upcoming vacancy in the Fed board. Trump announced that a decision would be made shortly, but ruled out Treasury Secretary Scott Bessent, who is currently the chair of the Fed board. His term expires in May 2026. The euro rose 0.68% to $1.1653. The dollar index (which measures the greenback in relation to a basket currency) fell by 0.5%, falling to 98.24. Brent crude futures dropped 75 cents or 1.1% to settle at 66.89 per barrel. U.S. crude fell 81 cents or 1.2% to settle at 64.35. Spot gold dropped 0.36% to $368.65 per ounce. U.S. Gold Futures were flat at $3433.4.
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APA's profit beats expectations in the second quarter on higher natgas production and prices
APA Corp beat Wall Street expectations for quarterly profits on Wednesday as higher natural gas prices and stronger production in Egypt helped to blunt the impact from lower oil prices and reduced total output. The shares of the company rose 2% during extended trading. Natural gas prices have rebounded since last year, mainly due to hotter weather conditions, higher demand for electricity generation, and lower U.S. stock injections. APA's average realized gasoline prices increased by nearly 29% to $2.28 per 1,000 cubic feet in the second quarter of last year. The volume of natural gas rose by 7%, to 894 millions cubic feet per day. This was largely due to a strong performance from Egypt. John Christmann, CEO of APA, said: "In Egypt we have exceeded our quarterly production guidance and increased our expectations once again for the gas programme in the second half year." APA also announced that it had received presidential approval to drill on an additional 2 million acres of land in Egypt. The Egyptian results help to cushion the impact of lower crude oil prices on assets. Brent crude was about 20% lower than a year ago in the second quarter, weighed down mainly by U.S. tariffs on imports, worries over global growth, OPEC+'s increasing supply, and persistent geopolitical tensions. After Israel's strike on Iranian nuclear sites in June, the price of a barrel briefly rose to $80 per barrel. However, it fell back down to $67 at quarter-end. APA reported that its average realized crude oil price for the third quarter was $65.58 per barrel, down from $82.28 last year. The company reported that its total quarterly production was down 2%, to 465.078 barrels equivalents per day from last year. According to data compiled and analyzed by LSEG, the Houston-based company reported an adjusted profit per share of 87 cents for the three-month period ended June 30. This compares with the 48 cents average analyst estimate. (Reporting by Arunima Kumar in Bengaluru; Editing by Alan Barona)
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Western Midstream buys Aris Water for $1.5 Billion
Western Midstream Partners announced on Wednesday that it would acquire Aris Water Solutions for $1.5 billion in cash and stock. The company wants to diversify its operations in the Permian basin. After the bell, shares of Aris Water Solutions rose by over 21%. Western Midstream, a natural-gas focused pipeline operator, has sought to build a leading platform for water infrastructure in the U.S.'s top oilfield and diversify their customer base throughout West Texas and southeast New Mexico. The company said that the acquisition would allow it to expand its footprint to the north, into Lea and Eddy Counties of New Mexico. It also provided access to additional throughput opportunities in its crude-oil, natural-gas and produced-water business. Aris has a full-cycle infrastructure of water assets, including 790 miles produced-water pipelines, 1.8 million barrels of produced water per day (mmbd), 1.4 mmbd water recycling capacity and 625,000 acres of dedicated land from counterparties of investment grade. Western Midstream CEO Oscar Brown stated that the acquisition would result in a "produced water gathering, disposal and recycling business which can meet flow assurance customers' needs." Occidental Petroleum, a U.S. shale oil producer, holds a stake of 43.5% in the pipeline operator. Aris shareholders receive 0.625 units of Western Midstream per Aris share or $25 in cash. The maximum cash consideration is $415,000,000. The deal should close by the end of 2025. Reporting by Vallari Shrivastava, Bengaluru. Editing by Alan Barona
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Trump Administration memo urges countries not to accept plastic production caps under UN Treaty
According to memos and communications obtained by the, the United States sent letters to at most a few countries to urge them to reject a goal of a global treaty that included limits on plastic production as well as plastic chemical additives. In communications dated July 25, which were circulated at the beginning of the negotiations on Monday to all countries, the U.S. outlined its red lines in negotiations. This puts it directly against over 100 countries who have supported these measures. As delegates gather to discuss what was supposed to be the last round of negotiations, hopes for an ambitious global treaty have faded. There are still significant differences between the oil-producing nations, who oppose limits on virgin plastic production, fueled by coal and petroleum, and parties like the European Union, small island states and others, who advocate for limits and stronger management of hazardous chemicals and plastic products. The U.S. delegation was led by career State Department employees who represented the Biden Administration. They sent memos to other countries outlining their position, and stating that they will not accept a treaty which addresses plastic pollution upstream. The memo was addressed to unnamed countries due to the sensitive nature of the negotiations. NAIROBI MEETING In a memo, the U.S. admitted that, after attending an initial heads of delegations meeting in Nairobi, from June 30 to 2 July, "we clearly do not see convergence in provisions related to supply of plastics, plastic production or plastic additives, as well as global bans and restriction on products and chemicals (also known by the global list). The spokesperson for the State Department told each party to take appropriate measures in accordance with their national context. The spokesperson stated that some countries may decide to ban certain products, while others might want to concentrate on improving collection and recycling. John Hocevar is the Oceans Campaign Director at Greenpeace USA. He said that the U.S. delegation under Trump was a return to "old school bullying" by the U.S. government, which used its financial power to persuade governments to change their positions in a manner that benefited what the U.S. wanted. One diplomatic source, from a country that supports an ambitious treaty, said the treaty was a good example of how to preserve the multilateral framework in a global context with many challenges. They said: "Multilateralism can either become the lowest common denominator and we will only be able to progress on less ambitious things or we can show that we have a global framework for important issues." In a resolution that was seen by the. Sources familiar with the talks told the newspaper that the U.S. was seeking to rollback language that had already been agreed upon in 2022, to renegotiate a new mandate for the Treaty. "Refusing plastic production to be included in this treaty does not represent a negotiation position." Juan Carlos Monterrey Gomez, the head of Panama's delegation, said that it was economic self-sabotage. They are blocking the progress of their industry. "They are keeping their people from the next wave in prosperity." The U.S. position is broadly in line with that of the global petrochemicals sector, which had stated similar positions before the talks and several powerful oil and chemical producing countries who have maintained this position during the entire negotiation. Over 100 countries support a global cap on plastic production. The Trump administration in the U.S. has taken numerous measures to Roll back climate and environmental policy It says that industry is burdened with too many obligations. According to the OECD, plastic production will triple without intervention by 2060, choking oceans and harming human health, as well as accelerating climate changes. (Reporting from Washington by Valerie Volcovici and Olivia Le Poidevin, and editing by Ed Osmond & Nick Zieminski.)
Wall Street gains as oil prices reverse
Wall Street indexes rose Wednesday on the back of a largely positive corporate earnings report. U.S. yields were also up, but European shares ended flat, ending a two-day streak of gains. U.S. president Donald Trump has issued an executive directive imposing a 25% additional tariff on Indian goods, claiming that the country imported Russian oil. The oil prices fell after U.S. State Secretary Marco Rubio said that a decision would be made later Wednesday about possible sanctions against Russia for its war in Ukraine.
The MSCI index of global stocks rose by 0.72%, to 939.4.
Wall Street saw the Dow Jones Industrial Average rise 0.32% to 44,549.5, the S&P 500 gain 0.76% at 6,347.26 while the Nasdaq Composite rose 1.16% at 21,160.02.
Earnings have a mixed response. "Earnings are seeing a mixed reaction.
The STOXX 600 Index in Europe closed 0.06% down, with healthcare stocks dragging it down after Trump announced his tariff plan for pharmaceuticals.
The MSCI broadest index for Asia-Pacific stocks outside Japan fell by 0.08%, closing at 654.33, while Japan’s Nikkei gained 0.60%, reaching 40794.86. Wall Street's performance on Tuesday was impacted by the health of the U.S. Economy. Data showed that services sector activity had unexpectedly stagnated in July. This reinforced the message of Friday's weak jobs data which led markets to increase their bets that the Federal Reserve would cut rates in September.
Samy Chaar is the chief economist of Lombard Odier. He said that there's a tug-of war between the concrete signs we have seen showing that the U.S. economic slowdown and the fact that rates are going down, which will remove some pressure on valuations.
The focus of traders has been on the tariff impact.
"The market seems to be more concerned with the fact we won't get maximalist tariffs. But I wonder if they aren't paying enough attention to the fact we could still see more moderate tariffs in the future, such as on pharmaceuticals," Chaar said. Trump said on Tuesday that he will announce tariffs on chips and semiconductors in the coming week. The U.S. will initially impose a'small tariff' on pharmaceutical imports, before increasing the tariff substantially over the next year or two. He said that the U.S. and China were close to a deal, and he planned to meet with his Chinese counterpart Xi Jinping by the end of this year if a deal was reached. Brazil has requested consultations at the World Trade Organization regarding U.S. Tariffs. Treasury yields have gained on the government bond markets. The yield on the benchmark U.S. 10 year notes increased 4.2 basis points from late Tuesday to 4.238%.
FedWatch from the CME shows that Fed funds futures indicate a 94% probability of a rate reduction next month. At least two cuts are priced in this year. Investors await Trump's choice to fill the upcoming vacancy on Fed board of Governors. Trump announced that a decision would be made shortly, but ruled out Treasury Secretary Scott Bessent, who is currently the Fed's chief and whose tenure ends in 2026.
The euro rose by 0.71% to $1.1656.
The dollar index fell by 0.53%, to 98.20, measuring the greenback in relation to a basket including the yen, the euro and other currencies.
Brent oil futures fell by 0.95%, to $67 per barrel. U.S. crude dropped 1.14%, to $64.43.
Gold prices dropped 0.33%, to $3369.62 per ounce. U.S. Gold Futures were flat at $3433.4.
(source: Reuters)