Oil and gas stocks moved in and out of positive territory in early trading on Wednesday as crude oil prices gained ground ahead of a government update on petroleum inventories due later in the morning.
The Amex Oil Index dipped 0.4% to 870 points while the Amex Natural Gas Index lost a fraction to 376 points. The Philadelphia Oil Service Sector Index added less than 1% to 141 points
Crude for May delivery was up 25 cents, or 0.5%, to $49.66 a barrel in electronic trading on Globex. Natural gas futures fell 2 cents to stand at $3.67 per million British thermal units. See full story.
The Organization of Petroleum Exporting Countries said in a monthly report that it expects oil demand to drop 1.4 million barrels a day in 2009, a downward revision of 400,000 barrels from a month ago.
"The world economic recession continues to erode oil demand growth," the cartel, which controls about one third of the world's oil production, said in the report.
Repsol SA led decliners in the Amex oil benchmark, down 3.6% to $18.55, followed by a 1.5% retreat in shares of Anadarko Petroleum Corp. to $43.02.
Occidental Petroleum Corp. was the biggest winner, up 1.3% at $58.60.
In the natural gas index, Nicor Inc. El Paso Corp. and Chesapeake Energy Corp. all tacked on more than 1%.
On the news front, natural gas producer BG Group said Wednesday that the presence of another accumulation of light oil has been proven in the 4-BRSA-709 well offshore Brazil, known as Iguacu.
Petrobras is the operator of the BM-S-9 concession and holds 45%, BG Group holds 30% and Repsol holds 25%. Further evaluation of the discovery will continue, BG said, and the drilling of another well in this evaluation plan area will commence shortly.
