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by Stockwatch Business Reporter
West Texas Intermediate crude for January delivery shot up $2.33 to $58.43 on the New York Merc, while Brent for February added $2.18 to $63.00 (all figures in this para U.S.). The benchmarks were buoyed by a larger-than-forecast drop in U.S. crude inventories (as reported by the U.S. Energy Information Administration), as well as rumours that tomorrow's official OPEC meeting in Vienna will yield a deepening of the group's production-cutting pact. Here in Canada, Western Canadian Select traded at a discount of $21.16 to WTI, down from a discount of $20.56. Natural gas for January lost four cents to $2.40. The TSX energy index added 3.41 points to close at 131.53.
The jump in oil prices brought out the bulls today, with several Canadian oil and gas stocks being among the day's top gainers in percentage terms. One of the biggest gainers was Alberta Cardium producer Obsidian Energy Ltd. (OBE), up 10 cents to 71 cents on 322,300 shares. It last released news on Monday, when (as discussed in that day's Energy Summary) it appointed Stephen Loukas as interim president and chief executive officer. Mr. Loukas is a portfolio manager and co-founder of one of Obsidian's shareholders, the U.S. hedge fund FrontFour Capital (led by Zachary George, son of the late Rick George, who was once Obsidian's chairman). FrontFour's investment in Obsidian has done poorly over the years. Now Mr. Loukas will attempt to right the ship. The company has already laid out some of its planned steps. In addition to announcing Mr. Loukas's appointment on Monday, Obsidian also provided some initial guidance for the first half of 2020. It plans to spend $49.4-million and drill nine Cardium wells. According to the company's outgoing interim CEO, Mike Faust, this program will help demonstrate the effects of a "significant cost-savings plan to improve the company's competitiveness."
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