Energy stocks powered to new highs for 2009 on Tuesday as the sector drew power from gains in the broad market, a jump in crude oil futures, and more deal talk over an oil field in Ghana.
The S&P 500 rose about 7 points to 1078 on fresh hopes for an economic rebound. Crude futures prices rose $1.72 to $73.49.
The NYSE Arca Oil Index of the world's largest publicly traded oil producers rose 1.1% to 1066, breaking its earlier mark of 1056 on Sept. 22.
The NYSE Arca Natural Gas Index rose 1.7% to 531, breaking its former top 2009 mark of 522 on Oct. 8.
The Philadelphia Oil Service Index jumped 2% to 204, eclipsing its high of 198 on Sept. 22.
The rise comes amid a report from The Wall Street Journal that Chinese oil giant CNOOC Ltd. (CEO) will bid on offshore oil fields in Ghana in a challenge to Exxon Mobil Corp. (XOM).
CNOOC is in advanced talks with Ghana National Petroleum Corp. to bid for a U.S. firm's stake in the "Jubilee" discovery, the newspaper reported.
Shares of Exxon Mobil rose 1.3% to $70.15. CNOOC shares rose 22 cents to $145.81.
Among energy stocks in the spotlight, Anadarko Petroleum Corp. (APC) rose 1.7% to $68.56 despite a downgrade to neutral at SunTrust Robinson Humphrey.
Analysts cited valuation of the oil and natural gas producer. Anadarko's market value, "appropriately reflects competitive business model execution," analyst John Gerdes said in a note to clients.
After more than doubling since March, Anadarko has reached the firm's target price.
"The market's view of APC's value may be amplified by unsubstantiated takeover speculation following a recent discovery offshore Sierra Leone," Gerdes said in a note to clients. Anadarko plans to continue developing the Jubilee field in offshore Ghana, with production expected in late 2010. It'll cost an estimated $3 billion to develop Jubilee, analysts said.
On the public sector front, California Gov. Arnold Schwarzenegger on Sunday carried through on a threat to veto two renewable-energy bills.
Last month, Schwarzenegger ordered the state's Air Resources Board to draft rules to require the state's utilities to use renewables for a third of their retail power by 2020.
-By Steve Gelsi, 415-439-6400; AskNewswires@dowjones.com
