Oil and gas stocks cooled off along with the broader market on Tuesday as BP weighed on the sector with gloomy comments from the oil giant's CEO.
Increased production in the Gulf of Mexico following the threat of a storm also pushed down prices. Oil futures fell $1.26 to $79.69.
BP (BP:69.33, -1.91, -2.7%) declined 3.3% to $68.91 after the Financial Times reported CEO Tony Hayward that its financial performance was the lowest in at least a decade because of a variety of setbacks and complexities. He also plans to announce a streamlining of the company's organizational structure.
While no specific job cut figures have been included, they could be significant, at least based on what a competitor to BP is doing. French weekly La Lettre de l'Expansion reported Total SA (TOT: 80.84, -0.81, -1.0%) will restructure its retail-fuel network in France in late 2007 by eliminating 20% of the 2,000 jobs in its downstream business, or about 400 positions. Total shares fell $1.14 to $80.51.
The Amex Oil Index (XOI: 1,444.82, -21.43, -1.5%) fell 1.5%. The Amex Natural Gas Index (XNG:514.21, -2.57, -0.5%) shed 1%.
Noble Corp. (NE:49.15, -1.11, -2.2%) said Tuesday it expects to take a third-quarter charge of a penny a share, or $2.4 million after tax, as a result of the resignation of former Chairman and CEO Mark A. Jackson, who stepped down last week.
The charge includes the accelerated vesting of nonqualified stock options and time-vested restricted shares, the company said in a filing with regulators. He'll also get a separation payment of about $1.3 million. Noble Corp. shares fell 3% to $48.73 in recent trades. Meanwhile, in the ethanol sector, US Bioenergy (USBE: 8.08, -0.85, -9.5%) fell to a fresh 52-week low, with shares dipping 84 cents to $8.09, on the heels of other recent losses.
Last week, Solel Securities Group lowered its rating on the ethanol firm to sell on weakness in ethanol prices combined with the stability and upward bias to corn prices.
USBioenergy is trading below Soleil's target price of $9 a share. Pacific Ethanol (PEIX: 8.58, -0.62, -6.7%) fell 6.3% to $8.63, a fresh 52-week low.
VeraSun (VSE:10.64, -0.61, -5.4%) fell 6% to $10.60, a new 52-week low. Aventine Renewable (AVR:10.14, -0.83, -7.6%) slumped 6.3% to $10.28, a new 52-week low.
Archer Daniels Midland (ADM :0.00, 0.00, 0.0%) dipped 25 cents to $32.45 -- well above its 52-week low of $30.20 a share.
Via|MarketWatch|by Steve Gelsi
energyStocks|
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