Oil Plunges After Natural Gas Data

At last report, the center of Hurricane Wilma was about 170 miles southeast of Cozumel, Mexico and moving west-northwest. Maximum sustained winds are near 145 mph and weather analysts expect the storm to gather some strength over the next 24 hours.

Meanwhile, oil refineries in the gulf continue to come back on line following the twin blasts of Hurricanes Katrina and Rita. The U.S. Minerals Management Service said Thursday's shut-in oil production is 967,734 barrels of oil per day, the equivalent to 64.52% of the gulf's daily oil production. Thursday's shut-in gas production was 5.196 billion cubic feet per day, the equivalent to equivalent to 51.96% of the gulf's daily gas production.

On the international front, the Associated Press is reporting that insurgents in northern Iraq set fire to the main oil pipeline that links an oil field in Kirkuk to the country's largest oil refinery in Beiji, 155 miles north of Baghdad. The explosion set fire to the pipeline and several oil valves about 35 miles west of Kirkuk.

In company news, independent oil and gas company XTO Energy(XTO) said its third quarter profit more than doubled and beat analysts' expectations. XTO said earnings rose to $312.8 million, or 85 cents per share, from $140.8 million, or 40 cents per share, in the same period last year. Revenue increased 90% to $964.2 million from $507.4 million.

XTO said it set quarterly records for its oil and natural gas production and said in a statement that "with U.S. natural gas supply under stress, XTO has increased activity levels to 64 drilling rigs at work, up 10 from pre- hurricane levels and an increase of 90% from a year ago."

Oil and gas drilling contractor Noble(NE) said its third-quarter profit more than doubled. The Houston-based company said net income rose to $76.5 million, or 55 cents per share, up from $30.6 million, 0r 23 cents per share in the year ago period. Revenue grew 38% to $367.2 million from $265.6 million in the same period last year. Analysts had been expecting the company to earn of 61 cents per share on revenue of $374 million.

Rowan Cos.(RDC) said it would sell its only semi-submersible rig, the Rowan-Midland, to ATP Oil & Gas for about $60 million. Rowan said it expects to record a pre-tax gain on the transaction of $45-50 million over the 15-month payment period. Rowan will retain ownership of the drilling equipment on the rig and will continue to provide operating personnel to ATP under a separate services agreement.

Citigroup upgraded Diamond Offshore Drilling

(DO) from hold to buy. Lehman Brothers upgraded Murphy Oil(MUR) from underweight to equal-weight. And Calyon Securities initiated coverage of Halliburton (HAL) as a buy.

Most of the big energy players were down in recent trading. ConocoPhillips(COP) was down $3.07 to $58.48. Chevron(CVX) was down $2.26 to $56.08. Exxon Mobil(XOM) was down $1.60 to $55.57. And BP(BP) was down $1.40 to $64.43.

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