Oil Stocks Are Surging
A report by the U.S. government on Wednesday indicated that crude supplies rose 1.29 million barrels last week, marking the smallest weekly gain since the seven-day period ending January 2. Analysts were expecting a gain of 3.6 million barrels for the week.
The report, issued by the Energy Information Administration, resulted in West Texas Intermediate for May delivery to spike 3.4 percent to $55.12 a barrel at 11:04 a.m. on the New York Mercantile Exchange on heavier than normal volume. The commodity touched $55.44, the highest it has traded at since December 29, 2014. Brent for May settlement also rose 2 percent to $59.57 a barrel on the ICE Futures Europe exchange following the U.S. government report.
Equities And ETF Movers
The VelocityShares 3X Inverse Crude ETN linked to the S&P GSCI Crude Oil Index Excess Return (NYSE: DWTI) plunged more than 12 percent. By contrast, the United States Oil Fund LP (ETF) (NYSE: USO) jumped 4 percent.
Several drilling and exploration names were leading the rally after the report's release. Ocean Rig UDW Inc (NASDAQ: ORIG), an offshore drilling contractor saw its shares surge nearly 10 percent. Energy XXI Ltd (NASDAQ: EXXI), an independent oil and natural gas exploration and production company were also trading higher by nearly 10 percent.
Transocean LTD (NYSE: RIG) was up more than 8 percent at $18.58.
Mega-cap energy-related companies were also higher, albeit not as much. Shares of Exxon Mobil Corporation (NYSE: XOM) gained 1.7 percent while shares of Chevron Corporation (NYSE: CVX) were trading higher by 1.2 percent.
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