Sector Update: Energy
Energy stocks are narrowly lower, with the NYSE Energy Sector Index sinking 0.1% while shares of energy companies in the S&P 500 are down 0.2% as a group. Crude oil for February delivery is up $1.87 - or just more than 2% - at $94.46 per barrel, while February natural gas is up 5 cents to $4.42 per 1 million BTU.
Crude oil futures rose Wednesday after new inventory data showed a 7.7 million barrel decline in commercial supplies during the week ended Jan. 10. Industry experts polled by Platt's had been expecting just a 1.6 million barrel drop in supplies last week.
The draw marked the seventh week in a row U.S. inventories have fallen, now declining 40.2 million barrels since the week ended Nov. 22, according to Energy Information Agency data.
In company news, shares of Sanchez Energy Corp ( SN ) rose, reaching its best level since late November, after the oil and gas company said it expects to produce between 21,000 to 23,000 barrels of oil equivalent per day during 2014 - more than doubling 2013 levels.
SN also unveiled its 2014 capital plan. It expects to spend between $650 million to $700 million this year, with at least $620 million allocated for drilling and completing around 70 net wells. The 2014 capital plan should be fully funded through a combination of internally generated cash flow, cash on hand and "modest" borrowings under the company's credit facility, it said.
Roughly three-quarters of SN's production this year will be crude oil with natural gas and natural gas liquids making up the remaining 14% and 11% of production, respectively.
SN shares were up just 0.1% at $25.06 each in recent trade after earlier climbing to an intra-day high of $26.34 a share, the stock's best price since Nov. 26.
In other sector news,
(+) MHR, (+0.8%) Announces 23% increase in proved reserves at the end of 2013 over 2012 levels to 75.9 mln barrels of oil equivalent; present value rises 22% year over year to $922 mln.
(-) KOS, (-7.3%) Forecasts 2014 production of around 24,100 barrels of oil per day, little changed from 2013 levels after Tullow Oil plc (TLW.L), its partner in the Jubilee field, said 2014 production would be at lower end of its previous guidance.
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