Morning Commentary: Oil, energy names tighten; Time Warner flat ahead of bond offering

By Aleesia Forni

New York, Nov. 17 – High-grade credit spreads were broadly tighter early Tuesday, with oil and energy company names trading mixed following an early drop in oil prices.

Marathon Oil Corp.’s senior notes (Baa1/BBB/) traded flat to tighter, while Exxon Mobil Corp.’s 2.709% notes due 2025 were around 2 bps wider.

ConocoPhillips Co.’s senior notes (A1/A/) firmed 1 basis point in the secondary market.

In other secondary action, Time Warner Inc.’s existing notes (Baa2/BBB) were 1 bp better as the company preps a two-part new issue set to price during Tuesday’s session.

The Markit CDX North American Investment Grade 25 index was 1 bp tighter at a spread of 82 bps early during the trading day.

Marathon Oil mixed

In secondary happenings, Marathon Oil’s 3.85% notes due 2025 were flat at 292 bps bid, a market source said.

The company sold $900 million of the notes on June 1 at a spread of Treasuries plus 170 bps.

The tranche of 5.2% bonds due 2045 was 1 bp better at 325 bps bid.

Marathon Oil sold $500 million of the bonds in the June 1 offering at Treasuries plus 225 bps.

The energy company is based in Houston.

Exxon Mobil weakens

Meantime, Exxon Mobil’s 2.709% notes due 2025 were 2 bps wider at 69 bps bid, according to a market source.

Exxon Mobil sold $1.75 billion of the notes (Aaa/AAA) on March 3, 2015 at Treasuries plus 58 bps.

The oil and gas company is based in Irving, Texas.

ConocoPhillips improves

ConocoPhillips’ 2.2% notes due 2020 firmed 1 bp to 67 bps bid, according to a market source.

ConocoPhillips sold $500 million of the notes on May 13, 2015 at Treasuries plus 65 bps.

The company’s 3.35% notes due 2025 also firmed 1 bp to 144 bps bid.

ConocoPhillips sold $500 million of the notes in the May 13, 2015 deal at Treasuries plus 110 bps.

The energy company is based in Houston.

Time Warner better

And Time Warner’s 3.6% notes due 2025 were 1 bp better at 160 bps bid, a market source said.

The company sold $1.5 billion of the notes on May 28 at a spread of Treasuries plus 150 bps.

Time Warner is a media company based in New York.

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