NEW YORK (MarketWatch) -- Energy stocks continued riding higher with pricier oil on Thursday as the International Energy Agency fattened its world-oil-demand forecast for the first time in ten months.
With U.S. gasoline prices currently averaging $2.63 a gallon, sales at U.S. retailers rose for the first time in three months in May as expected, lifted by strong car fuel and building material receipts, according to a government report on Thursday.
The International Energy Agency increased its forecast of 2009 world oil demand by 120,000 barrels a day, citing stronger-than-forecast first-quarter data from countries belonging to the Organization for Economic Cooperation and Development.
Global oil demand is projected at 83.3 million barrels a day, down 2.9% compared to the year earlier. \"These revisions do not necessarily imply economic recovery but may reflect a slowing in previously sharp decline,\" the IEA said.
Against this backdrop, Energy stocks moved up with rising crude oil and advances in the broad market. The NYSE Arca Oil Index (XOI 1,001, +6.99, +0.70%) rose 0.4% to 997.
The NYSE Arca Natural Gas Index (XNG 463.98, +10.54, +2.32%) rose 0.9% to 458. The Philadelphia Oil Service Index (OSX 184.78, +1.23, +0.67%) rose 0.8% to 185. Component Schlumberger (SLB 60.17, +0.90, +1.51%) rose 1.4% to $60.09 after Societe Generale initiated coverage of the oil service giant with a buy rating.
Oil prices moved up, with crude advancing 44 cents to $71.77 a barrel.
Among stocks in the spotlight, Exxon Mobil is in talks with TransCanada (TRP 30.18, +0.40, +1.34%) to join a massive pipeline project in Alaska, The Houston Chronicle reported Thursday. The viaduct to bring natural gas from the North Slope of Alaska to U.S. markets would rival the Denali pipeline underway by ConocoPhillips (COP 46.21, +0.45, +0.98%) and BP (BP 52.16, +0.00, +0.00%) .
Shares (XOM 73.92, +0.08, +0.11%) of Exxon Mobil rose 0.7% to $74.38.
Scott Jepsen, spokesman for Denali, the joint venture of Houston-based ConocoPhillips and London-based BP, told the newspaper that Denali officials had no comment because they hadn\'t seen an announcement about an alliance.
Linn Energy LLC late Wednesday named Mark E. Ellis as president and chief executive officer, effective January 2010. He currently holds the position of president and chief operating officer. Michael C. Linn, currently chairman and chief executive officer, will become executive chairman of the board.
\"I plan to remain very involved with the strategic direction of the company in my role as executive chairman,\" Linn said.
