Natural Gas Jumps (USO, UNG, GLD, SLV, KOG, ATPG)
Crude Oil fell towards $83 a barrel on Monday, erasing early gains after a pro-bailout vote in Greece failed to ease concerns about the euro zone while analysts said oversupplied crude markets would cope with any loss of Iranian oil.
Pro-bailout parties in Greece will form a government after a narrow election victory over the left that eased fears of a sudden exit from the euro. But the possibility that other larger economies such as Italy and Spain may also need to be rescued remains a threat to the euro zone and is driving investors to reduce their exposure to risky assets.
“The economic outlook is upsetting people more than security issues around Iran, and they realize that nothing really has come out of Greece, except that the crunch may have been delayed for a while,” said Roy Jordan, an oil analyst at Facts Global Energy. Leaders at a Group of 20 will be under pressure to produce a lasting solution to a debt crisis at a two-day meeting in Mexico.
Gold turned higher after concerns about the rising cost of Spanish debt roiled markets Monday. The metal recently wavered between small gains and losses, with the August contract up 70 cents, or less than 0.1%, to $1,628.70 an ounce on the Comex division of the New York Mercantile Exchange.
July gasoline traded 3 cents lower, or 1%, to $2.67 a gallon, with July heating oil down 2 cents, or 0.6%, to $2.63 a gallon. Natural gas bucked the downward trend, with the product for July delivery up 6 cents, or 2.4%, to $2.53 per million British thermal units.
United States Oil Fund LP (ETF)(NYSEARCA:USO) was down 0.18 (-0.57%) at $31.45, SPDR Gold Trust (ETF)(NYSEARCA:GLD) fell 0.05 (-0.03%)to $157.79, iShares Silver Trust (ETF)(NYSEARCA:SLV) surged 0.09 (0.32%) to $27.90 and United States Natural Gas Fund, LP(NYSEARCA:UNG) rose 0.75 (4.37%) to $17.92.
Cabot Oil & Gas Corporation(NYSE:COG jumped 1% despite S&P Capital IQ’s move to downgrade its rating on the stock to Sell from Hold and reducing its price target to $30 from $33. “We see production up 40% in ‘12, but volumes are mostly unprotected for price changes in ‘13 leaving Cabot exposed to changing prices,” the firm says.
ATP Oil & Gas Corporation(NASDAQ:ATPG) plunged 9.56% to $4.73 after 30% spike on Friday, which apparently was caused by ATPG’s action in suing the U.S. government for suspending Gulf of Mexico drilling in 2010. At the least, the lawsuit was effective in turning attention away from the defection of ATPG’s CEO less than a week after taking the job.