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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Mike from La. who wrote (39686)	3/11/1999 6:35:00 PM
From: Box-By-The-Riviera™	Read Replies (1) \| Respond to of 95453

Thursday March 11 5:34 PM ET Oil Prices Retreat As OPEC Stumbles By Atiya Hussain NEW YORK (Reuters) - Oil prices stalled and fell back Thursday as officials from top oil producers haggled in Amsterdam over a deal to cut production, trimming gains in oil shares, too. April crude oil futures on the New York Mercantile Exchange settled 38 cents weaker at $14.31 a barrel, giving back some of the gains which pushed prices up nearly 30 percent in the past few weeks. The jittery crude market posted most of the day's losses after Alvaro Silva, deputy oil minister of Venezuela, a key member of the Organization of the Petroleum Exporting Countries (OPEC), reiterated that production cuts should come from other producers. Oil ministers from OPEC members Saudi Arabia, Iran, Algeria and Venezuela, as well as high-level officials from non-OPEC producer Mexico, were to carry their talks through to Friday in an effort to reach agreement. Saudi Arabia and OPEC's Gulf Arab members agreed last weekend to make ''substantial,'' but as yet unspecified, cuts in production to reverse a world oil glut. A Gulf OPEC delegate told Reuters Wednesday that they were looking for a cut of 2.3 million barrels per day, or about 3 percent of world production. ''It's been a very surprising set of occurrences: The move to reduce production within OPEC, especially on behalf of Saudi Arabia and Iran,'' said Douglas Terreson, an analyst at Morgan Stanley Dean Witter, adding that oil-sector shares ''can go another 5 (percent) to 7 percent higher.'' Oil shares, which have lagged oil prices in recent days, played catch-up and surged in early trading, but gave up some gains when oil prices turned weaker. But oil companies were still prominent among Thursday's list of percentage gainers on the New York Stock Exchange. The Standard & Poor's Oil International Index, which tracks the performance of the world's largest oil companies, closed 3.05 percent higher at 872.45 points Thursday, and has gained more than 16 percent since the beginning of March. Foreign oil company shares also traded higher in New York. Russia's largest oil company, LUKoil, closed 8.5 percent higher at $6.51 a share Thursday. The suffering oil field service sector gained early but went into reverse again later in the day. The Philadelphia Stock Exchange's OSX index of oil service and drilling stocks closed 2.13 percent lower at 59.64. Not all the gains made by oil shares reflect oil prices, with investors seeking cheaper stocks as shares reach record highs. ''A lot of money is betting on the OPEC meeting, but not all of it,'' said Fadel Gheit, an analyst at Fahnestock & Co. ''With the stock market at an all-time high, investors are starting to shift assets into deeply discounted sectors like energy.'' Some analysts struck a note of caution, saying that the oil market, so closely tied to the performance of many oil companies, is already showing skepticism. ''There's not a lot of confidence that you'll see the oil cuts going through,'' explained one oil market analyst, who did not want to be quoted. ''The stocks will be crushed if (OPEC) doesn't go through because things are really bleak at the companies. The prices they have been seeing are pretty much the worst since 20 years,'' the analyst continued. Roger Diwan, an oil market analyst at Petroleum Finance Corp., agreed, noting that OPEC could have ''a terrible problem of credibility with a big production-cutting deal'' because of its failure to comply with the cuts it approved last year. Earlier Stories