Energy stocks finished mostly lower, but closed off their morning lows. Higher-beta subgroups such as the drillers and the oil services led the way on the downside, while the refiners bucked the negative trend by closing in the green as HollyFrontier Corp. registered a ~2.7% gain. Investors remained skittish ahead of the weekend as Spain is expected to request assistance for its troubled banks soon, European Central Bank Vice President Vitor Constancio said in remarks aired by Portugal's Radio Renascenca.

Both Brent and WTI crude prices fell, on the cusp of a sixth straight weekly loss as the euro zone's debt crisis and diminished hopes for monetary stimulus reinforced concerns about petroleum demand. WTI crude closed lower by $0.72 or 0.85% to 84.10. Another round of talks between the U.N. International Atomic Energy Agency and Iran resulted in no progress toward an agreement on allowing inspectors access to key facilities, the IAEA said, helping oil recover some losses, brokers and traders said. "The oil markets remain pressured by debt problems in Europe and global economic worries," said Tony Rosado, options broker at New-York-based GA Global Markets.

Money managers raised their net long U.S. crude futures and options positions in the week to June 5, the U.S. Commodity Futures Trading Commission (CFTC) said. The speculator group raise its combined futures and options position in New York and London by 1,582 contracts to 140,750 during the period.

Front-month natural gas futures closed higher by $0.025 or 1.5% to $2.299 as traders focused on warmer weather forecasts in key-consuming regions, which should increase the demand for air conditioning.

U.S. Integrateds

Societe Generale upgraded Chevron Corp to ‘Buy’ from ‘Hold’.

international Integrateds

Reuters - The local partners in BP Plc's Anglo-Russian joint venture TNK-BP had asked French oil major Total if it was interested in buying them out of the partnership, the Wall Street Journal quoted Total's chief executive as saying.

Reuters - Italian oil and gas major ENI is monitoring the situation about gas payments in Greece but currently does not see reasons for being particularly worried, its head said on Friday.

Reuters - The head of Gazprom Neft, the oil arm of Russia's gas producer Gazprom, said on Friday the company has no plans to buy BP Plc's stake in Anglo-Russian venture TNK-BP.

Reuters - Gazprom Neft, the oil arm of Russia's top gas producer Gazprom, will decide by the year-end whether to proceed with the Elephant oil project in Libya, Gazprom Neft's head said on Friday.

(Late Thursday) Reuters - Royal Dutch Shell Plc said it was shutting an unspecified unit at the upgrader facility of its 100,000-barrels-per-day Scotford refinery near Edmonton, Alberta. There could be flaring due to the unit shutdown, the company said in a message on a community information line.

Reuters - Motiva Enterprises reported emissions of hydrogen sulfide at its 233,500 barrel-per-day Norco, Louisiana, refinery, according to a notice filed with the U.S. National Response Center. Motiva is a joint-venture between Royal Dutch Shell Plc and Saudi Refining.

Reuters - Royal Dutch Shell Plc had a small fire at a production unit at its 255,000-barrel-a-day Scotford upgrader in Alberta on Thursday, though it expects "no material impact on production," a spokesman said.

Reuters - Norway's Statoil has resumed production at its Snoehvit liquefied natural gas processing plant, after suspending it for scheduled maintenance in May, a spokesman said on Friday.

Reuters - Norwegian oil firm Statoil signed a long-term deal to deliver liquefied natural gas to Malaysia, it said on Friday, the first such contract for the company in the lucrative Asian market.

(Late Thursday) Reuters - The head of French oil firm Total said it was maintaining its target of a 2.5 percent annual increase in oil and gas production and expects to restart production at its Elgin complex before year-end.

U.S. E&PS

(Late Thursday) Press Release - One June 1, 2012, ATP Oil & Gas Corp announced that Mr. Matt McCarroll replaced Mr. T. Paul Bulmahn as Chief Executive Officer of the company. Mr. Bulmahn continues to serve as Chairman and also in the newly created position of Executive Chairman of ATP. However, as of yesterday, June 7, 2012, the company announced that it was unable to reach a mutually agreeable employment agreement with Mr. McCarroll and effective yesterday has submitted his resignation.

Reuters - Southeastern Asset Management voted against Richard Davidson and Burns Hargis for election to Chesapeake Energy Corp’s board. The firm would support Hargis' resignation not being accepted until audit committee completes board review.

Reuters - Icahn representative says Chesapeake Energy Corp should consider all strategic alternatives, including sale. Icahn representative says Chesapeake CEO McClendon is 'great oil and gas man,' but needs board oversight. The CEO said more than 20 companies have looked at Permian basin assets, and another 10 still to examine asset data.

Reuters - Global Infrastructure Partners executive said there is no provision for higher offers in deal for Chesapeake Midstream Partners LP, and added that Chesapeake Energy Corp would be compelled to close deal for Chesapeake Midstream Partners LP even in case of higher bid.

Reuters - Chesapeake Energy Corp announced preliminary voting results from its annual shareholder meeting. Chesapeake energy-shareholders did not pass proposal to approve annual incentive plan; received support of 31% of votes cast. Chesapeake energy - shareholders passed proposal to amend long term incentive plan; received support of 86% of the votes cast.

Press Release - Chesapeake Energy Corp today announced plans to sell its midstream assets in three separate transactions for total expected cash proceeds of more than $4.0 billion. The midstream divestitures will also enable Chesapeake to reduce previously budgeted capital expenditures by approximately $3.0 billion over the next three years. Chesapeake has agreed to sell its limited partner units and its general partner interests in Chesapeake Midstream Partners LP to Global Infrastructure Partners for cash proceeds of $2.0 billion. Chesapeake expects to receive the first half of the proceeds on June 15, 2012 with a final closing and payment of the second half of the proceeds scheduled to occur by June 29, 2012. Chesapeake’s net book value for these assets as of March 31, 2012 was approximately $1.0 billion, and the company anticipates reporting a pretax gain on the sale of approximately $1.0 billion.

Press Release - Chesapeake Midstream Partners LP today announced that Global Infrastructure Partners has agreed to acquire all of Chesapeake Energy Corp’s ownership interest in CHKM for $2.0 billion. The acquisition, which is expected to close by June 29, 2012, will result in GIP’s ownership of 100% of CHKM’s general partner interest and 69% of CHKM’s limited partner units. Concurrent with this announcement, GIP signed a letter agreement to acquire certain midstream assets from Chesapeake Midstream Development, Chesapeake’s wholly owned midstream subsidiary, and CHKM signed a letter agreement to acquire from Chesapeake certain Mid-Continent gathering and processing assets.

(Late Thursday) Reuters - Chesapeake Energy Corp is looking to sell about 450,000 acres of its holdings in northern Michigan, as it works to raise money to meet an expected $9 billion to $10 billion cash shortfall, according to a prospectus released by one of its advisers.

(Late Thursday) Press Release - Penn Virginia Corp provided an update of its Eagle Ford Shale operations in Lavaca County, Texas.

CANADIAN E&PS

Reuters - Canacol Energy Ltd secured a $200 million credit facility. The company said the initial borrowing base is $85 million under the credit facility and the revolving facility has a three year term. As at March 31, 2012, the corporation had $68.1 million in cash, cash equivalents and restricted cash.

(Late Thursday) Press Release - Encana Corp released its annual Corporate Responsibility Report, providing a detailed review of the company’s environmental, social and governance performance for 2011.

refiners

Reuters - Phillips 66 plans to buy as many as 2,000 railroad tank cars to ship oil from shale fields to refineries, yet another sign that the shale boom is reshaping the U.S. energy industry.

(Late Thursday) Press Release - Tesoro Corp announced the successful conclusion of contract negotiations at its Golden Eagle (Martinez, California) refinery. Golden Eagle was the last of Tesoro's six United Steelworkers represented refineries to complete negotiations.

Reuters - Tesoro Corp said on Friday planned maintenance was complete at its 97,000-barrel-per-day (bpd) refinery in Wilmington, California, near Los Angeles.

MLPS

(Late Thursday) Press Release - Boardwalk Pipeline Partners LP announced that its indirect wholly-owned subsidiary, Gulf South Pipeline Company, LP, priced a private placement of $300 million aggregate principal amount of 4.00% senior notes due 2022. Gulf South expects the offering to close on June 12, 2012, subject to customary closing conditions.

Reuters - Global Infrastructure Partners executive said there is no provision for higher offers in deal for Chesapeake Midstream Partners LP, and added that Chesapeake Energy Corp would be compelled to close deal for Chesapeake Midstream Partners LP even in case of higher bid.

Press Release - Chesapeake Midstream Partners LP today announced that Global Infrastructure Partners has agreed to acquire all of Chesapeake Energy Corp’s ownership interest in CHKM for $2.0 billion. The acquisition, which is expected to close by June 29, 2012, will result in GIP’s ownership of 100% of CHKM’s general partner interest and 69% of CHKM’s limited partner units. Concurrent with this announcement, GIP signed a letter agreement to acquire certain midstream assets from Chesapeake Midstream Development, Chesapeake’s wholly owned midstream subsidiary, and CHKM signed a letter agreement to acquire from Chesapeake certain Mid-Continent gathering and processing assets.

Press Release - Chesapeake Energy Corp today announced plans to sell its midstream assets in three separate transactions for total expected cash proceeds of more than $4.0 billion. The midstream divestitures will also enable Chesapeake to reduce previously budgeted capital expenditures by approximately $3.0 billion over the next three years. Chesapeake has agreed to sell its limited partner units and its general partner interests in Chesapeake Midstream Partners LP to Global Infrastructure Partners for cash proceeds of $2.0 billion. Chesapeake expects to receive the first half of the proceeds on June 15, 2012 with a final closing and payment of the second half of the proceeds scheduled to occur by June 29, 2012. Chesapeake’s net book value for these assets as of March 31, 2012 was approximately $1.0 billion, and the company anticipates reporting a pretax gain on the sale of approximately $1.0 billion.

Reuters - Chesapeake Midstream Partners LP affirmed its EBITDA guidance for the twelve months ended December 31, 2012 of $475 million. The company projected organic EBITDA for the twelve months ended December 31, 2013 of $550 to $575 million. The company also affirmed guidance of expansion capital expenditures of $660 million and maintenance capital expenditures of $74 million for the twelve months ended December 31, 2013.

(Late Thursday) Press Release - Enterprise Products Partners LP today announced that the partnership’s Phase I Eagle Ford crude oil system has begun accepting deliveries and commissioning the pipeline and delivery stations. Originating in Wilson County, Texas and extending 147 miles to Sealy, Texas, the 24-inch diameter crude oil pipeline has a capacity of 350,000 barrels per day and provides Eagle Ford Shale producers with improved access to the Gulf Coast refining complex.

(Late Thursday) Reuters - Magellan Midstream Partners said inventories of N-grade gasoline in the central and northern tiers of its Midwest system are "below normal." The company will place certain terminals in these tiers of the system on allocation at noon on Friday because of the low level of stocks, said spokesman Bruce Heine.

market Commentary

The S&P 500 ended its best week in 2012 as investors returned to stocks after sources told Reuters Spain was expected to request aid for its troubled banks.

Thomson Reuters Energy Contacts:

Tim Moloughney:

646-822-2225

Rich Pontillo:

646-822-6326

Tamar Essner:

646-822-3646

Jeff O’Malley:

646-822-2926

Roopak Chakravarty

312-288-3090

Jasna Sulejmanagic

646-822-2829