SECTOR COMMENTARY

Oil and gas stocks closed mostly higher led by natural gas levered E&Ps after the front month contract traded at its highest level in 2 years.

WTI closed at $96.73 an increase of $1.76 or 1.85% on the start up of a new major pipeline, which is expected to help eliminate a bottleneck that has depressed the U.S. futures for three years, and on expectations that frigid weather in the Northeast would prompt strong demand for heating fuel. TransCanada Corp said it has begun to ship crude oil on its 700,000 bpd pipeline, which flows from Cushing, Oklahoma, to Gulf Coast refiners. The company expects to transport an average 525,000 bpd in the first year of service. Brent followed U.S. crude higher after two days of reports underscored strong global oil demand growth.

Henry Hub futures witnessed significant gains closing higher by $0.258 or 5.82% at $4.689, the highest level since July 2011 as frigid temperatures continued to bolster heating demand in key consuming regions. MDA Weather Services one to five day forecast predicted bitter temperatures along the East Coast and the six to ten day outlook that the cold would remain in the East and Midwest. The spread between the February 2014 futures contract and the March 2014 futures contract spiked to .136, the largest spread since January 2011, according to Reuters data.

U.S. INTEGRATEDS

Reuters - ExxonMobil said on Wednesday that its 300,000 barrel per day refinery in Antwerp was operating normally, contradicting traders' reports that there had been a problem at the plant.

Reuters - ExxonMobil reported a mechanical breakdown at its 238,600-barrel-per-day Joliet refinery in Channahon, Illinois, which led to flaring on Tuesday, a filing with regulators showed.

INTERNATIONAL INTEGRATEDS

Reuters - Russian natural gas export monopoly Gazprom will hold more talks with the European Commission on Thursday aimed at resolving a European Union anti-trust investigation, Russia's ambassador to the EU saidon Wednesday.

Reuters - Russia's top natural gas producer Gazprom said on Wednesdaythat it had proposed signing a major supply deal with China when President Vladimir Putin visits the country next May.

Reuters - Total's La Mede refinery near Marseilles in France is ramping up units and all are expected to be running by the end of next week, a union official at the refinery said on Wednesday.

U.S. E&PS

Due to an analyst departure, Canaccord Genuity Research is discontinuing coverage of Bill Barrett Corp., Bonanza Creek Energy, Cimarex Energy, Clayton Williams Energy, Concho Resources, Diamondback Energy, Gulfport Energy, Laredo Petroleum Holdings, Matador Resources, Midstates Petroleum, PDC Energy, Rosetta Resources, SAExploration Holdings, and Synergy Resources.

(Late Tuesday) Press Release - Comstock Resources, Inc. announced that its proved oil and natural gas reserves as of December 31, 2013 were estimated at 22.0 million barrels of crude oil and 453 billion cubic feet ("Bcf") of natural gas or 585 billion cubic feet of natural gas equivalent ("Bcfe") as compared to total proved reserves as of December 31, 2012 of 551 Bcfe.

Suntrust upgraded Endeavour International Corp. to ‘Buy’ from ‘Neutral.’

Stern Agee upgraded Southwestern Energy Co. to ‘Buy’ from ‘Neutral.’

Capital One upgraded W&T Offshore, Inc. to ‘Equal Weight’ from ‘Underweight.’

CANADIAN E&PS

(Late Tuesday) Press Release - Gran Tierra Energy Inc., a company focused on oil exploration and production in South America, today announced the results of a qualified independent reserve evaluation of the company's Peru reserves by GLJ Petroleum Consultants Ltd. ("GLJ") effective December 31, 2013. Working interest Bretaa 2P reserves of 61.5 million barrels of oil and 3P reserves of 113.9 million barrels of oil.

(Late Tuesday) Press Release - PENN WEST PETROLEUM LTD. is pleased to provide an operational update on fourth quarter 2013 activities and announces additional non-core asset dispositions for expected proceeds of approximately $175 million.

OIL SERVICES

Wells Fargo downgraded Superior Energy Services, Inc. to ‘Market Perform’ from ‘Outperform.’

REFINERS

Reuters - Phillips 66 reported an emergency response processing unit upset at its 362,000-barrels-per-day Wood River refinery in Roxana, Illinois, a filing with state pollution regulators said.

Citigroup initiated coverage of Valero Energy Corp. with a ‘Neutral’ rating.

Reuters - Valero Energy Corp. warned nearby neighbors of possible power supply problems triggering safety flares at its 200,000 barrel per day (bpd) Corpus Christi, Texas, refinery on Wednesday morning, a companyspokesman said.

MLPS

Press Release - Phillips 66 Partners LP announces that the Board of Directors of its general partner declared a fourth-quarter 2013 cash distribution of $0.2248 per limited partnership unit. This represents an increase of 5.8 percent over the minimum quarterly distribution of $0.2125 per unit.

Jefferies downgraded Targa Resources Corp. to ‘Hold’ from ‘Buy.’

Press Release - TransCanada Corporation is pleased to invite members of the media to participate in a briefing regarding the official start of customer deliveries through the company's Gulf Coast Project. This event will feature TransCanada's president and chief executive officer, Russ Girling and TransCanada's president of energy and oil pipelines, Alex Pourbaix.