U.S. Takes Initial Step To Lift Oil Export Ban; Refiner Stocks Sink
Oil drilling stocks were up a bit and refiners were down sharply on news that U.S. regulators approved the export of oil by two Texas companies.
Citi Research's John Nelson called the move by the Commerce Department "an initial step toward exporting," the growing production of U.S. crude oil.
Permitting the exports would lift a ban in place since the Arab oil embargo of the 1970s and might lift prices for U.S. producers coping with a glut from the shale boom.
Nelson said he's "encouraged" by an increasingly accommodating stance of the Obama Administration" with regard to producers he covers.
Although shares of refiners were off on the news, Citi's Eric G. Lee said separately that the action will have "no meaningful impact" on refiners' profits.
Yet among refinery stocks, PBF Energy Inc. (NYSE: PBF) dropped more than 10 percent to $23.23; Valero Energy Corp fell nearly 10 percent to $50.60 and Holly Frontier Corp. (NYSE: HFC) was off more than eight percent to $44.93.
Delek US Holdings Inc. (NYSE: DK) fell nearly eight percent to $29.50; Western Refining, Inc. (NYSE: WNR) declined seven percent to $37.76; lon USA Energy Inc. (NYSE: ALJ) was down seven percent to $12.36 and Marathon Petroleum Corp. (NYSE: MPC) was up more than seven percent to $80.09.
Among producers the swing was less dramatic. Pioneer Natural Resources (NYSE: PXD) which received the condensate export approval gained 4.4 percent to $231.47.
Others in the refinery group include Concho Resources Inc. (NYSE: CXO) up 2.22 percent to $139.42; EOG Resources Inc. (NYSE: EOG) up two percent to $115.35 and Whiting Petroleum Corp. (NYSE: WLL) up 1.7 percent to $79.06.
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