Following is a summary of top stories in the energy sector Friday afternoon.
Crude Breaks Out to Settle at New High
Oil futures climbed to a new record near $143 a barrel as the dollar weakened against the euro, confirming expectations that the falling greenback, a major factor in crude's stratospheric rise, will extend its decline and add to oil's appeal.
Retail gas prices inched lower overnight, but are likely to resume their own trek into record territory now that oil futures have broken out of the trading range where they had been for nearly 3 weeks.
Light, sweet crude for August delivery rose as high as $142.99 a barrel on the New York Mercantile Exchange before pulling back sharply in a spate of late-day profit-taking to settle up 57 cents at a record $140.21.
In other Nymex trading, July gasoline futures fell 1.01 cents to settle at $3.5012 a gallon after earlier rising to a trading record of $3.585. July heating oil futures lost 2.32 cents to settle at $3.9066 a gallon. August natural gas futures gave up 5 cents to settle at $13.198 per 1,000 cubic feet.
Refiners Hammered by Oil Price Surge
Shares of petroleum refiners hit new 52-week lows as the price of crude oil surged.
Valero Energy Corp., Tesoro Corp., Sunoco Inc., Holly Corp. and Frontier Oil Corp. all hit new lows in morning trading before regaining some ground.
Refiners' margins have been squeezed by rising crude prices and falling demand for refined products such as gasoline and diesel.
In afternoon trading Valero shares were down $1.50, or 3.7 percent, at $39.73. Tesoro fell $1.40, or 7.1 percent, to $18.64. Sunoco gave up 89 cents, or 2.4 percent, at $37.05. Holly shares slid by 84 cents, or 2.2 percent, to $37, and Frontier lost 97 cents, or 4 percent, at $23.49.
House Approves Mass Transit Aid
On Capitol Hill, the House approved financial help for mass transit systems facing a surge in riders because of high gas prices. But Republicans blocked Democrats from requiring oil and gas companies to drill on the millions of acres of government land and water on which they already own federal leases.
The House authorized $1.7 billion over the next two years to lower fares and expand operations as more riders flock to public transit. The transit measure, which must still be considered by the Senate, marks the first time federal money would be used to support local mass transit operating costs.
The oil lease proposal was an effort by Democrats to counter a push by congressional Republicans to lift a long-standing drilling ban on most offshore U.S. waters. Democratic leaders maintained the industry should first go after oil and natural gas in areas where they already hold leases.
Grey Wolf Spurns Precision Bid Again
Grey Wolf Inc., which drills oil and gas wells, rejected a third unsolicited takeover bid from Precision Drilling Trust, reaffirming its commitment to a previous agreement with Basic Energy Services Inc.
Grey Wolf said the Precision proposal undervalues the company and does not represent a significant premium to shareholders.
Grey Wolf also did not Precision refusal to increase its final offer of $10 per share.
Precision Drilling, a Canadian company, made its first bid to buy Grey Wolf for $9 per share earlier this month, and later raised the price to $9.30 per share. The latest offer of $10 per share valued the buyout at $1.79 billion, based on 178.8 million Grey Wolf shares outstanding as of April 30.
Cheniere in LNG Marketing Deal with JPMorgan Chase
Cheniere Energy Inc., a developer of liquid natural gas-receiving terminals, entered into a domestic marketing agreement for the sale of liquefied natural gas with a subsidiary of JPMorgan Chase & Co.
Financial terms were not disclosed.
The deal provides a framework under which the company's marketing subsidiary, Cheniere Marketing Inc., sells to JPMorgan liquefied natural gas it acquires on delivery to the Sabine Pass Terminal in southwest Louisiana.
In addition, JPMorgan will acquire part of Cheniere Marketing's capacity for storage and regasification services for the liquefied natural gas that JPMorgan purchases.
More Rigs Running in U.S. and Canada
The number of rigs actively exploring for oil and natural gas in the U.S. this week rose by seven from the week before.
Of the 1,913 rigs running nationwide, 1,530 explore for natural gas, 375 for oil and eight are considered "miscellaneous," according to Baker Hughes Inc., which tracks rig operations worldwide.
A year ago the rig count stood at 1,775.
There are 64 offshore rigs running in the Gulf of Mexico, down seven from a week ago and 13 fewer than a year ago.
In Canada, 356 rigs are operating. That is 97 more than last week and 125 more than a year ago.
--Compiled by AP Business Writer Greg Stec. Questions or comments can be directed to gstec@ap.org.
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