NEW YORK (TheStreet) -- Shares of Patterson-UTI Energy (PTEN) were falling, sharply lower by 6.03% to $20.11 in midday trading Tuesday amid worries that U.S. shale oil producers could increase drilling activity, weighing down oil prices, according to Reuters.
Last Friday, data released by Baker Hughes (BHI) showed that U.S. drillers reduced the number of rigs by just one. Analysts as Goldman Sachs said oil prices were at a level that would spur activity, Reuters reports.
Plus, analysts at Morgan Stanley said the dollar may strengthen further, which would drive oil prices down.
The strength in the dollar affects commodities like oil, that are priced in dollars by making them more expensive for holders of other currencies, Reuters noted.
WTI crude for July delivery was trading down 2.7% to $58.11 as of 12:37 p.m. ET today, while Brent crude for July delivery was also down 2.9% to $63.62 a barrel.
Snyder, Texas-based Patterson-UTI owns and operates fleets of land-based drilling rigs in the U.S.
The company provides pressure pumping services to oil and natural gas operators primarily in Texas and the Appalachian Basin.
Separately, TheStreet Ratings team rates PATTERSON-UTI ENERGY INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate PATTERSON-UTI ENERGY INC (PTEN) a HOLD. The primary factors that have impacted our rating are mixed, some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity."