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Tuesday, 10/06/2015 3:47:42 PM

Tuesday, October 06, 2015 3:47:42 PM

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Energy Up as Oil Futures Rally on Russia Rumors, Supply Growth -- Energy Roundup

Shares of oil-and-gas companies rose and oil prices climbed amid rumors that Russian officials would meet with counterparts at the Organization of the Petroleum Exporting Countries to discuss market conditions. Russia and Saudi Arabia kept their production levels high during a bust in oil prices this year in what looked like an effort to shake out higher cost U.S. competitors on shale oil fields. Now that many shale drillers are folding or shutting in wells, analysts speculate, Saudi and Russia may be willing to reduce their output slightly. On Tuesday, the U.S. Energy Information Administration said domestic crude production fell 120,000 barrels a day from August to September, to the lowest rate in a year. Global oil investments are set to be slashed by some $130 billion this year, crimping supplies and ultimately boosting prices, OPEC's chief said. Analysts at brokerage Morgan Stanley cut target prices for natural gas, saying dynamics in electricity markets meant there was "limited support for near-term natural gas prices, but it could get better into 2017." The Morgan Stanley analysts wrote: "Slowing producer activity increases risks for supply/ demand mismatches and higher pricing as export and industrial demand grows in the next 12-18 months."
--By Rob Curran , rob.curran@dowjones.com
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(END) Dow Jones Newswires
10-06-15 1543ET
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