Sector movers: Energy stocks jump as crude steadies after recent surge

The biggest strike by US refinery employees in three decades and speculation about a slowdown in drilling Stateside helped keep crude prices steady on Monday, pushing energy stocks and oil services shares to the top of the pile in London.

The industrial action, coordinated by the United Steelworkers (USW) union, has entered its second day and includes workers from over 200 refineries and facilities in the States.

These plants account for around a tenth of US refining capacity, marking the largest walkout since 1980.

The USW, which cited onerous overtime, unsafe staffing levels and dangerous conditions among the factors behind the mass strike, said it had rejected its fifth offer from Shell which is the lead company for the bargaining talks.

Brent futures were broadly flat at $52.93 a barrel in afternoon trade in London after having soared past the $50 mark on Friday after data from Baker Hughes showed that the number of US rigs drilling for oil dropped by 94, or 7%, last week.

Energy stocks such as Tullow, BG Group, Shell, Premier Oil, Cairn Energy and Ophir Energy were making decent gains.

Tullow, in particular, jumped 9% on the back of rumours that Shell could make a bid for its smaller rival.

Enquest rose 9% after saying that it would get $23m back after exiting its investments in Tunisia, though 2014 production would be slightly lower than previously thought as a result.

Shares in struggling oil group Afren more than doubled, though they were still well below the levels seen at the start of the year. After saying that it was in need of immediate funding, the company announced over the weekend that lenders had allowed it to defer a $50m payment due on its debt by a month. Afren also said it would delay a $15m bond coupon payment.

Top performing sectors so far today

Oil Equipment, Services & Distribution 16,119.81 +4.35%
Construction & Materials 4,442.11 +3.60%
Oil & Gas Producers 7,180.29 +3.20%
Mining 13,840.73 +1.39%
Food & Drug Retailers 3,164.43 +1.33%

Bottom performing sectors so far today
Beverages 14,852.80 -1.37%
Fixed Line Telecommunications 4,670.40 -1.35%
General Retailers 2,974.17 -1.16%
Travel & Leisure 8,349.40 -1.16%
Personal Goods 26,853.49 -1.03%