Crude Oil Slips Below $85

NEW YORK (TheStreet) -- Oil futures lost steam at midday after recently trading above the $85-a-barrel mark, lifted by details of a rescue package for Greece and a weaker U.S. dollar.

The May delivery crude contract was losing 4 cents, to $84.88 a barrel, after trading as low as $84.08 in the morning, possibly pressured by news that in March, China had its first monthly trade deficit in nearly six years.

The contract recently soared as high as $85.71 a barrel on details of a eurozone and International Monetary Fund contingency plan for Greece. The news lifted European currencies, which weakened the dollar. The greenback, however, recently pared some of its losses, trading 0.3% lower against a basket of foreign currencies.

Meanwhile, energy mergers and analysts upgrades were lifting shares across the energy sector.

Arch Coal(ACI) and Patriot Coal(PCX) were each gaining more 3% on upgrades from Citi analysts. Arch Coal was upgraded to buy from hold and Patriot Coal was lifted to hold from sell in a short-term trade on account of an incline in metallurgical coal.

Shares of Mirant(MIR) and RRI Energy(RRI) were surging 18.7% and 13.7%, respectively, following a weekend announcement that the two electricity companies would merge, forming one of the largest independent power producers in the U.S. Both shares were among the New York Stock Exchange's top-performing stocks.

Natural gas energy stocks were trading higher on Friday's news that India's Reliance Industries will pay $1.7 billion for a 40% Marcellus Shale joint venture with Atlas Energy(ATLS). Atlas shares were rising 0.8%, to $38.55.

According to RBC Capital Markets analyst Scott Hanold, Reliance will pay $340 million in cash upon closing and roughly an additional $1.4 billion in a drilling carry. Reliance will pay for 75% of Atlas' portion of drilling and completion costs until the $1.4 billion drilling carry is reached.

"The transaction implies $14,167 per acre, making this the most lucrative transaction announced in the Marcellus play to date and values Atlas shares at nearly $75 a share," Hanold said, adding that this assumes discounted value of joint-venture acreage and the $8,000 per acre value that Reliance has preferential right to on acreage not held in the joint venture.