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Energy stocks surge with oil; Exxon's earnings rocket

January 31, 2011 | 10:49 am

Hunting for opportunity in crisis, some investors are flooding back into energy stocks on Monday amid another jump in oil prices sparked by Middle East social unrest.

It also helped that Exxon Mobil Corp.’s fourth-quarter earnings were well above expectations.

Of the 10 major stock industry sectors in the Standard & Poor’s 500 index, energy was up 2.2% at about 10:45 a.m. PST, topping all nine other sectors. The S&P index overall was up 0.6%.

Exxon Exxon Mobil shares rallied $1.42, or 1.8%, to $80.41, a two-year high. The energy giant said its oil and natural gas production surged last quarter, lifting earnings to $9.25 billion, or $1.85 a share, a 53% jump from $6.05 billion, or $1.27 a share, a year earlier.

Wall Street analysts had expected $1.62 a share.

“They’re hitting their production growth at exactly the right time,” Jason D. Gammel, an analyst at Macquarie Capital Europe Ltd., told Bloomberg TV. “Their production is going to be up over 7% this year, and when you’re doing that into the face of a rising commodity-price environment, the earnings and cash-flow effects are just magnified.”

Crude oil prices soared again Monday on worries about Middle Eastern supplies. Near-term futures in New York were up $2.30, or 2.6%, to $91.64 a barrel, after briefly trading above the recent two-year closing high of $91.86 reached on Jan. 12.

Exxon Mobil’s stock market value, already the largest of any U.S. company, rose above $400 billion on Monday, to $405 billion.

That’s widening the gulf between Exxon and No. 2 Apple Inc., which is valued at $312 billion.

Other energy issues rallying Monday included ConocoPhillips, up $1.09 to $71.65; Chevron, up $1.52 to $94.89; Hess Corp., up $2.34 to $83.85; and Apache Corp., up $3.43 to $118.27.

-- Tom Petruno

Photo credit: Justin Lane / EPA