Analysts Get Giddy About Oil Amid Talk of OPEC Cuts

It's not easy to see through crude oil, but a couple of analysts think they may be looking at a near-term bottom in the petroleum sector.

For the past two months, oil and oil-related stocks have been on a steep downward trend as demand for oil and gas deteriorated. On Friday morning, reports out of two analysts described how the events of the last quarter set the stage for a near-term rally in the oil and gas sectors.

UBS Warburg's James Stone upgraded Halliburton(HAL Quote), BJ Services(BJS Quote) and Ensco International(ESV Quote) to buy from hold, largely based on valuation, indicating that the sharp selloff in oil stocks over the second quarter of 2001 was overdone. Tyler Dann, an oil analyst for Banc of America Securities, approached the sector from another angle, issuing a note discussing the likelihood that OPEC will cut production before its next scheduled meeting. Published reports are now surfacing that ministers from the oil producing nations will lower output in the next 10 days. ...