XEC - Why Oil Stocks Are Up Big Today
The oil market is in rally mode today. Crude oil rose more than 1.5% the day after a closely watched report from the U.S. government showed a significant drop in oil storage levels. That fueled optimism across the energy sector, sending most stocks soaring. The biggest gainers were Cimarex Energy (NYSE: XEC), Antero Resources (NYSE: AR), Nabors Industries (NYSE: NBR), Noble (NYSE: NE), and Oasis Petroleum (NYSE: OAS), which were all up by double digits by midafternoon.
The Energy Information Agency reported a 10-million-barrel decrease in U.S. oil storage levels this week. That was the biggest decline in the last five weeks, and was much more than the 4.7-million-barrel reduction most analysts expected. According to an analyst with Again Capital, "it was an incredibly bullish report, one of the more bullish we've had in a while." That's because it suggested that demand was higher than supply, which is good news for the oil market.
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