SECTOR COMMENTARY

Energy stocks closed mostly higher, with the oil services sector posting the largest gains despite Baker Hughes guiding lower for its fourth quarter due to issues in Iraq. The integrateds were relative laggards on the day, closing in the red.

WTI crude oil futures closed higher by $1.06 or 1.16% to $92.72, while Brent crude was also higher as new reports of production problems at a major U.K. oilfield and as weaker-than-expected U.S. jobs data raised expectations that the U.S. Federal Reserve may slow the winding down of its commodity-friendly stimulus program. In the U.S. market, the unexpectedly weak jobs report triggered a short-term rally from the previous session's 8-month low.U.S. oil futures rose to a session high after the market flirted with technically oversold territory for the first time in two months, but later pared gains.

Natural gas futures erased early losses and rallied $0.048 or 1.20% to $4.053 despite warmer forecasts for key regions this weekend. According to Baker Hughes, the U.S. gas rig count fell by 15 to 357 and is down 77 from last year.

U.S. INTEGRATEDS

(Late Thursday) Press Release - Chevron Corporation reported in its interim update that earnings for the fourth quarter 2013 are expected to be comparable with third quarter 2013 results. Upstream earnings for the fourth quarter are projected to be lower than the prior quarter, while downstream earnings are expected to be higher.

Press Release - Hess Corporation today completed the previously announced sale of its Pangkah asset to a subsidiary of PT Saka Energi Indonesia, which exercised its pre-emption rights, for a total after tax consideration of $650 million comprising the sale of equity interests in certain holding entities and certain inter-company debts. The asset, located off the coast of Indonesia, produced an average of 9,000 barrels of oil equivalent per day net to Hess in the first three quarters of 2013.

INTERNATIONAL INTEGRATEDS

BNP Paribas cuts its rating for BP Plc to ‘Neutral’ from ‘Outperform’

(Late Thursday) Reuters - The U.S. pipeline regulator has provisionally accepted proposed rates for non-contract shippers on Royal Dutch Shell'snewly reversed Ho-Ho crude oil pipeline, pending a hearing into complaints that they are unfair.

(Late Thursday) Reuters - Royal Dutch Shell Plc reported a crack in a process line at its facility in Deer park, Texas, according to a filing with the state regulators.

BNP Paribas raised its rating on Royal Dutch Shell Plc to ‘Outperform’ from ‘Neutral’.

(Late Thursday) JP Morgan raised its rating for Statoil to ‘Overweight’ from ‘Neutral’.

BNP Paribas cuts its rating for Total to ‘Neutral’ from ‘Outperform’

U.S. EPS

Canaccord raised its rating on EPL Oil Gas to ‘Buy’ from ‘Hold’.

CANADIAN EPS

(Late Thursday) BMO resumed coverage and raised its rating on Canadian Natural Resources to ‘Outperform’ from ‘Market Perform’.

(Late Thursday) Reuters - Parex Resources Inc. provided an operational update October 1-December 31, 2013 (Q4): 17,285 bopd, an increase of 35% over the fourth quarter of 2012 and 7% greater than the prior quarter production.

OIL SERVICES

Press Release - Baker Hughes Incorporated provides the following update for the fourth quarter of 2013: Following the disruption to its business in Iraq during the fourth quarter, Baker Hughes resumed operations by the end of December. Due to the lost revenue related to this event, expenses associated with personnel movements and security measures, and other nonrecurring items, the pretax and after-tax profit impact from the disruption in Iraq during the fourth quarter is approximately $80 million, or $0.18 per share.

Press Release - Baker Hughes Incorporated announced today that the U.S. onshore well count for the fourth quarter 2013 is 9,056 wells; down 19 wells from the revised 9,075 wells counted in the third quarter 2013. Compared to the fourth quarter 2012, the well count was up 398 wells or 5%. Due to improved drilling efficiencies, the average US onshore drilling rig now produces 9% more wells compared to the same quarter last year.

Press Release - Cameron today announced the retirement of John Carne as Chief Executive Officer of OneSubsea effective February 28, 2014. John has served as CEO of OneSubsea since the Cameron and Schlumberger joint venture was formed in June 30, 2013.

(Late Thursday) Press Release - ShawCor Ltd announced that, based on a preliminary review of fourth quarter operating results, it expects to report significantly lower earnings for its fourth quarter of fiscal year 2013 compared with the record earnings reported in the third quarter. These preliminary estimates are being provided despite the fact that ShawCor's auditors have not completed their procedures with respect to such information nor completed their audit of ShawCor's results for the fiscal year 2013.

DRILLERS

Press Release - Ensco plc has promoted David Hensel to Senior Vice President - Marketing. Mr. Hensel has been Vice President - North and South America Business Unit since May 2011.

MLPS

Citi lowered its ratings on Cheniere Energy Inc to ‘Neutral’ from ‘Buy’.

Citi raised its rating for Cheniere Energy Partners LP to ‘Buy’ from ‘Neutral’