Energy Shares Fall on Doubts About Oil Rally - Energy Roundup
Shares of energy producers fell even as oil futures held around a two-year high, amid divergent views on the sustainability of the rally. Oil futures have surged amid growing tensions between Saudi Arabia and Iran, two of the world's largest producers. In one sign that industry players anticipate much of those gains sticking, Sembcorp Marine received a contract from Norwegian giant Statoil for a potential $490 million floating production and storage vessel. Another effect of rising prices is the resumption of drilling activity on shale oilfields in the U.S., where production is often more costly. This week, the number of rigs drilling for oil in the U.S. rose by nine to 738, according to Baker Hughes, a GE company. The last stumble in the oil rally came when higher prices caused a rebound in U.S. production, stoking fears of oversupply.
-Rob Curran, [email protected]