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To: TokyoMex who wrote (2362)	3/22/1998 9:36:00 PM
From: jack montgomery	Read Replies (1) \| Respond to of 14347

Hi TokyoMex, Here's the latest on OPEC'S moves! Jack FOCUS-Oil stocks seen rising after Riyadh deal NEW YORK, March 22 (Reuters) - Shares of U.S. oil companies, especially those involved in upstream or exploration and production operations, are expected to jump on Monday along with the price of oil after major oil producing countries announced a deal to cut world oil output. ''This is a strongly bullish development, especially for exploration & production companies,'' said Michael Metz, chief investment strategist for CIBC Oppenheimer & Co. In Riyadh on Sunday, Saudi Arabia, Venezuela and Mexico said an agreement was reached between OPEC and some non-OPEC members to cut up to two million barrels per day or 2.7 percent of supply from a glutted world oil market. The agreement came after days of secretive talks. The deal sent oil prices above $16 a barrel in trading on New York Mercantile Exchange's (NYMEX) out-of-hours ACCESS system at 1900 EST/2400 GMT. Bellwether oil futures for May delivery on the NYMEX closed Friday at $14.61. Companies with upstream operations are considered far more sensitive to fluctuations in oil prices than those with only downstream, or refining and marketing, operations. ''Most mutual fund investors have been underweight in oil stocks,'' said Deutsche Morgan Grenfell oil analyst Michael Young. According to a DMG analysis, Amerada Hess Corp. (AHC - news) is one of the most financially sensitive companies to oil price swings. A rise of $1 a barrel translates into a near doubling in earnings per share. Amerada Hess shares closed Friday up 87.5 cents at 59-1/2. Crude oil futures on the New York Mercantile Exchange (NYMEX) surged at the open of out-of-hours trading on the ACCESS system Sunday after the oil supply agreement. Futures for May delivery opened $1.14 above Friday's close of $14.61 a barrel and and climbed above $16 in the first few minutes of trading. Young says the whole oil sector is likely to rise initially. ''In the past when the group has these big moves, they all go up; there isn't that much differentiation. Exxon, one of the least leveraged to a given change in oil price, had one of the strongest moves on Friday,'' he said. Exxon Corp. (XON - news) shares rose $2.50 on Friday to 67-5/16 and touched a new year high of 67-3/4. Young says he thinks the sector will move around 10 percent higher. ''In the year to date, the sector has underperformed between 10 and 15 percent. I expect the stocks will pretty much erase that gap and end up being market performers.'' Some oil analysts, like Young and Paul Ting of Salomon Smith Barney, had recently upgraded the sector, which had taken a beating with oil prices. On Friday, oil shares outperformed the broader market. Ting, in upgrading the sector, said: ''The oils should be bought now,'' recommending Texaco Inc. (TX - news), British Petroleum Co. Plc (quote from Yahoo! UK & Ireland: BP.L), Mobil Corp. (MOB - news) and Exxon Corp. (XON - news) among the internationals and Atlantic Richfield Co. (ARC - news) and Murphy Oil Corp. (MUR - news) among the domestics. The jump in oil prices should cushion any slip in the overall stock market. Chevron Corp. (CHV - news) and Exxon are components of the Dow Jones industrial average. Though there had been much speculation last week about secret meetings between oil producers, the announcement Sunday in Riyadh came as a surprise to many. Under terms of the deal, Saudi Arabia will cut 300,000 barrels per day, Venezuela 200,000 barrels per day and Mexico 100,000 barrels per day. Other OPEC members -- apart from Iraq, which currently exports oil only under a strictly controlled United Nations program -- would also cut, as would some non-OPEC members. Oil prices have been in a slump since late last year, falling in New York by more than 45 percent to a nine-year low below $13 a barrel last week. The severity of the drop had badly damaged the national finances of heavily oil-dependent countries. -------------------------------------------------------------------------------- More Quotes and News: Amerada Hess Corp (NYSE:AHC - news) Atlantic Richfield Co (NYSE:ARC - news) Chevron Corp (NYSE:CHV - news) Exxon Corp (NYSE:XON - news) Mobil Corp (NYSE:MOB - news) Murphy Oil Corp (NYSE:MUR - news) Texaco Inc (NYSE:TX - news) Related News Categories: US Market News