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Oil And Gas Stocks Fall Back on Wall Street as US Investors Play Catch-Up

Last updated: 19:56 27 Nov 2009 GMT, First published: 20:56 27 Nov 2009 GMT

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Many US oil traders have been reaching for their ‘Sell Button’ this morning as they return to work with little thanks for the Emirate state-owned Dubai World. While most of America’s oil traders were relaxing at home yesterday, Dubai World sought refuge from its $60 billion debts triggering a global sell off.


Both equities and commodities came under pressure after Thursday’s news that state owned Dubai World had delayed its debt repayment obligations. Traders in New York and Chicago will now be playing catch-up with their European and Asian counterparts.


West Texas Crude fell $5/barrel earlier today amid fears that a potential default in Dubai could seriously hamper the robust economic recovery which appears to be priced into $75+ crude. WTI Futures were last changing hands around $74 after hitting earlier intraday lows of $72.30.


Many economists expect the neighbouring Emirate state of Abu Dhabi to bail out Dubai. However many of the world’s major institutional investors and central banks hold the Emirate state’s sovereign debt and the potential fallout of any default remains unclear.


On Wall Street oil and gas majors fell across the board in response to the wider bearish pressure, Total SA (NYSE: TOT),Murphy Oil Corp (NYSE: MUR) and EnCana (NYSE: ECA) were the worst effected as they both dropped around 3%.


Meanwhile Chevron (NYSE: CVX) and ConocoPhillips (NYSE: COP) both slid 2% lower and ExxonMobile dropped 1.5%.

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