It was a week where oil prices were back to losing ways and natural gas settled near a five-week low. On the news front, Chevron Corp. CVX is facing problems with its massive Big Foot project, while ConocoPhillips COP has decided to pull out of its shale gas operations in Poland.

Overall, it was a bearish week for the sector. While West Texas Intermediate (WTI) crude futures lost 1.9% to close at $59.13 per barrel, natural gas prices were down approximately 2% to $2.59 per million Btu (MMBtu). (See the last ‘Oil & Gas Stock Roundup’ here: Exxon Gets Nod to Export LNG, Chevron Sells NZ Fuel Unit.)

Oil prices fell for the first time in several weeks, in reaction to the decision by the international cartel of oil producers – OPEC, or the Organization of the Petroleum Exporting Countries – to maintain daily crude production level at the preset 30 million barrels in the face of continued oversupply. Moreover, a stronger dollar has made the greenback-priced crude dearer for investors holding foreign currency.

Natural gas also fared badly amid predictions of weak cooling demand with forecasts of mild temperature across the country over the next few days. A higher-than-expected supply increase added to the pessimism.

Recap of the Week’s Most Important Stories

1.    Chevron Corp. declared that three additional tendons − that were installed for securing its Big Foot tension-leg platform to the seabed of Gulf of Mexico (GoM) – have sunk and are lost. Last week, the integrated firm reported the loss of six tendons. Consequently, Chevron announced plans to move its floating platform to the sheltered waters from the deepwater U.S. GoM. Hence, a total of nine tendons faced damages and are lost.

Initially, Chevron planned to start production from the Big Foot development by late 2015. But now, with damages to three additional tendons, the company is unsure about the project startup date. It is to be noted that the Big Foot project was expected to produce roughly 75,000 barrels of oil per day and 25,000 cubic feet of natural gas daily.

2.    U.S. energy firm ConocoPhillips has decided to pull back from shale gas exploration in Poland as it failed to uncover commercial volumes of the gas. As per the company, its affiliate in the country – Lane Energy Poland – has invested around $220 million since 2009. Seven wells have been drilled by the unit over its three Western Baltic concessions.

After Chevron Corp. withdrew from the region at the beginning of this year, ConocoPhillips’ was the last major oil company looking for shale gas in Poland. (See More: ConocoPhillips Ends Shale Gas Exploration in Poland)

3.    Land drilling contractor, Nabors Industries Ltd. NBR has decided to cut the salary of two of its top executives for another six months to weather the unfavorable oil pricing scenario. Anthony G. Petrello – the chief executive officer of the company – saw his salary being slashed by 10% for the January to June period. The current salary reduction extension will lower Petrello’s yearly pay further to $1.575 million from $1.75 million. Moreover, Nabors has now reduced the base salary of its chief financial officer, William Restrepo, to $585,000 from $650,000.

Nabors’ cost reduction initiative was noticed in its first-quarter 2015 results. The company’s direct expenses related to operations were recorded at $919.6 million, down 13.4% from the year-ago quarter. This helped the company to report strong first-quarter earnings.

4.    FMC Technologies Inc. FTI declared the completion of the formation of a joint venture (JV) – Forsys Subsea – wherein the oilfield equipment manufacturer and Technip SA have 50% ownership each. The JV started operations from Jun 1, 2015. By combining the technology and expertise of the two subsea industry leaders, the joint venture company will be capable of assisting the upstream energy players in efficiently getting their first oil at a minimum cost.

after using Forsys Subsea’s new technology, the upstream players can increase their profits by lowering operating costs in this weak crude pricing environment. FMC Technologies added that the newly formed company has its headquarters in London and is expected to have a headcount of 320. (See More: FMC Technologies, Technip in Forsys Subsea Joint Venture)

5.    Independent oil and gas explorer Cimarex Energy Co. XEC announced that its Chief Financial Officer (CFO), Paul Korus, will retire on or before Sep 1, 2015. The company also announced the appointment of Mark Burford as its CFO, effective as of Korus' retirement.

Burford joined Cimarex in 2005 and is currently serving as Vice President of Capital Markets and Planning. Korus has been instrumental in mapping out strategies that have proved tremendously successful for the company. (See More: Cimarex Energy CFO to Step Down; Replacement Announced)

Price Performance

The following table shows the price movement of the major oil and gas players over the past week and during the last 6 months.

Over the course of last week, the best performer was offshore driller Transocean Ltd. RIG that added 0.3% to its stock price, while the biggest loser was refiner Tesoro Corp. TSO, which fell 3.6% during the period.

Over the last 6 months, another refiner Valero Energy Corp. has been the chief beneficiary on the bourses with its shares advancing 18.6%. On the other hand, oil major Exxon Mobil Corp. was the laggard, as it witnessed a 7.2% price decline over the same time frame.

What’s Next in the Energy World?

Apart from the usual releases in this week – the U.S. government data on oil and natural gas – market participants will be closely tracking a series of crucial economic reports, including those on retail sales, jobless claims and PPI.

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