Analyst Forecasts Improvement In Energy Stocks

DENVER (AP) — A recovering global economy and tighter crude oil supply and demand should help stocks of energy exploration and production companies, a Goldman Sachs analyst said Friday.

"We believe economic improvement will help broader energy demand and lead to greater-than-expected crude oil prices, which we expect will be positive for energy equities," analyst Brian Singer wrote in a research note.

He upgraded his rating on Apache Corp. to "Buy" from "Neutral" because of its oil-liquid exposure, improved North American resources and attractive valuation. Singer also raised his six-month share price target to $115 from $92.

The analyst reaffirmed "Buy" ratings for Devon Energy, EOG Resources and Chesapeake Energy. He raised the six-month share price target for Devon to $90 from $78; for EOG to $101 from $85; and for Chesapeake to $34 from $27.

Singer raised his Forest Oil Corp. rating to "Neutral" from "Sell," and raised his share price target to $22 from $16.

He downgraded SandRidge Energy to "Sell" from "Neutral," and said he believes credit for its improved resource base likely will be short-term. His share price target for SandRidge was raised to $13 from $12.

In afternoon trading, shares of Apache rose 48 cents to $92; Devon fell 51 cents to $67.36; Chesapeake fell 22 cents to $27.60; and EOG fell $1.08 to $78.97.

Shares of Forest Oil fell 19 cents to $18.85 and SandRidge fell 36 cents, or 3 percent, to $12.03.