Energy bonds up as crude rises; Seventy Seven loan firms; Freeport-McMoRan gains continue

By Paul Deckelman

New York, Feb. 17 – The recently battered bonds of the energy sector were firming on Wednesday, traders said, helped by signs that world crude oil producers may finally start curbing their output – specifically, oil producer Iran welcoming plans by fellow producers Russia and Saudi Arabia to cap crude oil production at January levels.

That helped to drive crude prices higher. Both Brent and West Texas Intermediate posted hefty gains, rebounding from Tuesday’s losses.

And that in turn helped to give a lift to such names as Whiting Petroleum Corp., which continued to rebound solidly after having been beaten down on Friday by a massive credit ratings cut by Moody’s Investors Service.

Other oil and gas issues seen higher included Chesapeake Energy Corp., California Resources Corp. and Denbury Resources Inc.

Already helped by the overall energy rise, Seventy Seven Energy Inc.’s bonds and term loan B moved higher following the announcement of the company’s quarterly numbers.

Metals mining and energy concern Freeport-McMoRan Inc.’s paper continued to rise, helped by news of a planned company asset sale.

A trader saw AK Steel Holding Corp.’s bonds and shares better, helped by the prospect that higher oil prices may lead to increased drilling activity, which would translate into orders for steel with which to build drilling rigs.

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