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by Stockwatch Business Reporter

West Texas Intermediate crude for October delivery crossed below $40 on the New York Merc for the first time since February, 2009, before settling at $40.45, down 69 cents (all figures in this para U.S.). Worries about too much supply and too little demand (particularly from China) continued to take their toll. Brent for October lost $1.16 to $45.46. Western Canadian Select traded at a discount of $14.90 to WTI ($25.55), up from a discount of $15.55. Natural gas for September lost 7.9 cents to $2.676. The TSX energy index lost 2.39 points to close at 162.16.

Ray Chan's Baytex Energy Corp. (BTE) lost 70 cents to $5.93 on 14.2 million shares, after announcing last night that it would suspend its dividend and move its budget and production guidance to the low ends of their ranges. The monthly dividend had previously been cut to 10 cents from 24 cents in December. Investors cheered the move at the time, sending Baytex's stock up 44 cents to $16.90 on Dec. 9 -- still a long way down from the previous summer's high of $50.16. As it turned out, the stock was not done falling. Yesterday it closed at $6.63 and yielded 18.1 per cent. Baytex says it had no choice but to eliminate the dividend, despite setting itself a goal nearly 12 years ago of always having a "meaningful" payout. It has promised to reintroduce the dividend once oil prices recover to an unspecified level. It has also lowered its 2015 budget to $500-million (from a range of $500-million to $575-million) and its production guidance to a range of 84,000 to 86,000 barrels of oil equivalent a day (down from a range of 84,000 to 88,000). The bulk of Baytex's budget is going to its shale assets in the Texas Eagle Ford, the only ones that can make money at today's oil prices. (The company's website estimates that they break even at $35 (U.S.) a barrel, compared with $44 (U.S.) to $47 (U.S.) for its heavy oil assets in Canada. Each country contributes roughly half of total production.)

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