Updated from 2:48 p.m. EST
Energy futures were generally flat to lower Tuesday as traders adjusted their focus toward warmer temperatures staking claim upon much of the U.S.
The March light sweet crude oil contract finished the day down $1.32 to $58.07 a barrel. The near-term heating oil contract was 2 cents lower at $1.65 a gallon, and unleaded gasoline was even at $1.65 per gallon.
Natural gas, weaker earlier, turned around and rose 9 cents to $7.59 per million British thermal units.
Analysts say that a springtime mentality is setting in at the New York Mercantile Exchange as the near-term contract for crude oil changes this week from the March contract to the April contract.
Max Pyziur, energy analyst at CPM Group in New York, said the energy market is seeing a "see-saw effect" from competing forces caused by market fundamentals and geopolitical news.
On one hand, the U.S. has large inventories of crude and refined products like distillates, gasoline and jet fuel, says Pyziur. As winter tapers off, refineries tend to ramp up gasoline production to prepare for the summer driving season.
However, the U.S. already has adequate gasoline inventory for this coming summer, and the market is pricing that in.
On the other hand, there's continuing uncertainty in financial markets over what will come of the Iranian nuclear issue. Many United Nations member countries are expected to react in one form or another over the next few days.
Japan announced on Friday that it was enacting trade sanctions on Iran for its refusal to abandon its nuclear program. Although the U.S. has two aircraft carrier groups in the Persian Gulf, few analysts are expecting military intervention, Pyziur says.
reported that Iran's president, Mahmoud Ahmadinejad, has offered to stop uranium enrichment on the condition that Western nations end their own nuclear development.
Although the stance of the international community appears to be less aggressive toward Iran than it was last summer, financial markets remain concerned about the limited amount of spare crude oil capacity if Iran were to become suddenly shut in.
Lower commodity prices pushed energy stocks broadly lower. The
iPath Goldman Sachs Crude Oil
ETF closed down 1.5% to $35.78.
Deutsche Securities upgraded Canadian integrated energy firm
from hold to buy and hiked the company's price target to between $65 and $70. Sunoco finished up 59 cents at $62.37.
Goldman Sachs upgraded the stock for E&P firm
from neutral to buy and raised its price target to $59. Ultra Petroleum was down 59 cents to $50.97.
Shares of electricity provider
were downgraded by Jeffries from buy to hold but climbed 17 cents to $99.83. A.G. Edwards downgraded shares of E&P company
from buy to hold. Exco's stock slipped 5.5% to $16.93.