NEW YORK (TheStreet) -- Chesapeake Energy (CHK) - Get Report stock is declining 2.17% to $4.05 in mid-afternoon trading on Tuesday, as lower oil prices weigh on shares of the natural gas and oil producer.
Following a recent rally propelled by hopes for a production freeze by major producers, oil prices are now retreating as it appears that supply will continue to outpace demand.
U.S. crude inventories are at their highest level in more than 80 years, and storage tanks at the key storage hub at Cushing, Okla. are near their capacity, the Wall Street Journal reports.
"The rally has run its course, and I think our next big move is another trip back below $30," Stephen Schork, editor of industry newsletter The Schork Report, told the Journal.
Crude oil (WTI) is falling by 2.67% to $38.34 per barrel and Brent crude is sinking by 2.56% to $39.24 per barrel this afternoon, according to the CNBC.com index.
Separately, TheStreet Ratings team rates the stock as a "sell" with a ratings score of D+.
Chesapeake Energy's weaknesses include its deteriorating net income, generally high debt management risk, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself.
You can view the full analysis from the report here: CHK
TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this article's author.