Shares of the Select Sector SPDR Energy exchange-traded fund (XLE) are higher by $1.47, or 3%, at $53.36, despite President Obama’s announcement, as widely expected, that the administration is suspending consideration of permits to drill in the Artic near Alaska until next year, and will extend for six months the deepwater drilling ban.
The President referred to the corrupt relationship between the oil industry and Federal regulators. While pressing the point that BP (BP) had a genuine interest in plugging the leak in the Gulf as soon as possible, Obama acknowledged that BP might have an interest in downplaying the scope and scale of the spill, which is still disputed.
For example, U.S. Geological Survey director Marcia McNutt said today that a team of researchers she is heading up has estimated that the rate of flow of the leak may be as great as twice the daily rate of flow of Exxon Mobil’s (XOM) Valdez spill, at a rate of 12,000 to 19,000 barrels per day. That’s sharply higher than the 5,000 barrels-per-day figure that’s been circulating for weeks.
BP shares are currently up $2.40, or 6%, at $44.81; Transocean (RIG) has also held onto gains, rising $1.40, or 2.4%, to $59.99; Halliburton (HAL) is up 73 cents, or 3%, at $26.52; and Cameron International (CAM) is up $1.24, or 3.4%, at $37.31.
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