Iraqi fires help boost service stocks
El Paso tops in energy-trading sector
By Lisa Sanders, CBS.MarketWatch.com
Last Update: 1:41 PM ET March 20, 2003
NEW YORK (CBS.MW) -- Shares of oil service stocks marched higher Thursday on reports that a few oil wells were afire near the port city of Basra in Iraq.
U.S.-based service companies -- particularly Houston-based Baker Hughes (BHI: news, chart, profile) and Halliburton (HAL: news, chart, profile) -- are expected to get first dibs on contracts to rebuild Iraq's dilapidated oilfield infrastructure, pending a successful campaign against Saddam Hussein.
Halliburton (HAL: news, chart, profile) eclipsed its daily trading average, qualifying as the most active in the service sector, and Baker Hughes (BHI: news, chart, profile) was on a pace to top its average volume as well.
The PSE Oil Service Index (OSX: news, chart, profile) gained 2 percent to 87.26. Shares of Halliburton rose by 48 cents to $20.98, and Baker Hughes added 77 cents to $30.90.
Also, Boots & Coots (WEL: news, chart, profile), which specializes in the business of putting out oilfield fires, sank 20.5 percent to $1.67 on the American Stock Exchange.
That only a few oil wells were ablaze may well indicate that the Iraqis don't have the technology to blow up all the wells with a remote trigger. See more in Futures Movers.
On the New York Mercantile Exchange, April crude slumped by $1.08 to close at a three-month low of $28.80 a barrel, and May crude, which becomes the front month contract on Friday, dropped by $1.06 to close at $28.30.
Meanwhile, the CBOE Oil Index ($OIX: news, chart, profile), the benchmark for integrated oil companies, was flat at 246.77.
Among the integrated oils, Dow Industrials component ExxonMobil (XOM: news, chart, profile) advanced 12 cents to $35.71, ChevronTexaco (CVX: news, chart, profile) gained 5 cents to $65.88 and ConocoPhillips (COP: news, chart, profile) tacked on 53 cents to $51.91.
U.S.-traded shares of Total (TOT: news, chart, profile), which has a production-sharing agreement with Iraq, dropped 97 cents to $63.88 on more than double its daily average volume.
Also, the Amex Natural Gas Index (XNG: news, chart, profile) stood at 166.93, up 1.4 percent. April natural gas gained 3.2 cents to close at $5.31 per million British thermal units in Nymex action.
Elsewhere, trading in shares of El Paso Corp. led the energy sector as the company's stock reclaimed a level not seen in about six weeks.
The San Francisco Chronicle reported Thursday that El Paso had agreed to pay $1.7 billion to California to settle litigation and end investigations into whether the gas pipeline operator withheld supply during the state's energy crisis. See more.
An El Paso (EP: news, chart, profile) spokesman said a settlement had not been reached and declined comment, but Chief Executive Ronald Kuehn indicated a resolution could be near in a letter to employees on Tuesday. See related story.
Rebounding from weakness in the prior session, El Paso jumped 18 percent to $6.49 on extremely heavy volume of 25.2 million shares.
The Philadelphia Utility Index ($UTY: news, chart, profile) was up 0.4 percent to 245.74.
Lisa Sanders is a Dallas-based reporter for CBS.MarketWatch.com. |
