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Gold/Mining/Energy : Canadian Oil & Gas Companies -- Ignore unavailable to you. Want to Upgrade?

To: Richard Saunders who wrote (8544)	11/20/2001 4:44:58 PM
From: Cal Gary	Read Replies (2) \| Respond to of 24920

Oil-services shares gain with stronger oil prices Updated: Tue, Nov 20 12:50 PM EST NEW YORK (Reuters) - Shares of oil-services companies moved up on Tuesday on speculation that an agreement among OPEC and non-OPEC oil producers to cut output was imminent. The speculation also bolstered sagging oil prices. The Philadelphia Oil Service Index, which fell 13.8 percent last week, was up 3.8 percent, and the Standard and Poor's Oil Drilling Index was ahead 4.28 percent. Major integrated drillers Schlumberger Ltd., Halliburton Co. and Baker Hughes Inc. were among the strongest gainers, while offshore drillers like Rowan Cos. Inc. and Transocean Sedco Forex also showed good gains. On the New York Stock Exchange, shares of Schlumberger gained 6.8 percent, or $3.05, to $47.98, while Halliburton shares were up 5.7 percent, or $1.15, to $21.50. Baker Hughes gained 6.3 percent, or $1.94, to $32.94, while Rowan was up 6.9 percent, or $1.06, to 16.44. Transocean rose 6.2 percent, or $1.68, to $28.99. Shares of Precision Drilling, Canada's largest oil service company, rose 4.3 percent, or C$1.40, to C$34.07 in Toronto. Analysts remain cautious on the outlook for U.S. onshore drillers due to weak natural gas prices, but sone predict that companies with a more international scope will take a more long-term view when parceling out dollars for exploration and production spending. Shares of companies that have big onshore drilling operations, such as Nabors Industries and Parker Drilling, also gained, but not as much as the larger offshore drillers. Nabors shares were up 4.7 percent, or $1.37, to $30.82, while shares of Parker gained 10 cents, or 3.3 percent, to $3.09. Members of the Organization of Petroleum Exporting Countries (OPEC) have said they will cut oil output by 1.5 million barrels per day beginning in January, contingent on a commitment from non-OPEC oil producers, including Mexico, Norway, Oman and Russia, to cut their output by 500,000 barrels per day. Russia, the world's No. 2 oil producer, has not yet committed to making the cuts, but a statement by its deputy prime minister that it was considering the cuts was viewed as positive. Also, Norway's oil minister said Oslo would cut crude output if all OPEC members and non-OPEC oil exporters made cuts. According to the energy watchdog International Energy Agency, OPEC produced 30.3 million barrels of liquids per day in the third quarter, less than half the daily worldwide output of 77 million barrels. Global demand was put at 75.7 million barrels per day.

To: Richard Saunders who wrote (8544)	11/21/2001 7:31:34 PM
From: CIMA	Respond to of 24920

Rethinking Oilpatch Stock Picks Paul Haavardsrud Financial Post November 21, 2001 Given the drubbing oil and gas stocks took last week after oil prices fell to two-year lows, it stands to reason that there's money to made in the oil patch. The question investors are asking is what to buy. As always the answer lies with commodity prices and that's become an even tougher call of late. Talk of supply cuts from Norway and Mexico yesterday lifted the price of West Texas intermediate crude US72¢ higher to US$19.15 a barrel. Last week, it fell as low as US$17.45 and the doomsayers were talking about a return to 1998 levels when it fell below US$11. Here are a few scenarios and a heads up on which stocks could benefit under each: Scenario 1: Oil falls below US$16. If supply cuts don't come and a global economic recovery stretches into a 'U' instead of a 'V', oil prices could head much lower. For Mark Heim, an analyst at Yorkton Securities Inc., the integrated producers - Imperial Oil Ltd. [T.IMO], Petro-Canada [T.PCA], Shell Canada Ltd. [T.SHC], and Suncor Energy Ltd. [T.SU] -- are in the best position to weather the commodity price storm. He recommends clients overweight integrated producers, due in part to the revenue stability provided by their downstream operations. When crude prices drop, "...you tend to see marketing margins improve drastically," he said. Ian Ollers, an analyst at Harris Partners, said Alberta Energy Corp. [T.AEC] would be his top pick given weak oil prices, due to the company's stable sources of cash flow in pipeline and natural gas storage. "If you're fearful [about commodity prices] then AEC would be your first candidate." Scenario 2: Oil shoots to US$24. If the United States's war on terrorism drags on and draws in other Middle Eastern nations, a supply crunch could send the price soaring. "If you really want to make the bet on oil, the one that springs to mind is Nexen [T.NXY]," said Mr. Ollers, noting it is 80% oil-weighted. Other big oil-levered producers singled out by analysts include Canadian Natural Resources Ltd. [T.CNQ] and Vermilion Resources Ltd. [T.VRM]. Andrew Hogg, an analyst at Yorkton Securities, added that Canadian Natural and Vermilion each have hedging programs in place that protect them from falling prices, but leave room to benefit from improved prices. Scenario 3: Oil sits between US$18 and US$20. Consensus estimates are calling for oil prices to stay in this band. If prices stay in this range, the sector as a whole could be a good bet, according to John Manley, a strategist at Salomon Smith Barney in New York. "We believe that the risk of low oil prices has been mostly priced into stocks." Mr. Manley said the sector is trading at a 30% to 35% discount to the broader market. The last time the group traded at such a large discount was in 1985, after which the sector outperformed the broader index by 30% in the next two years.