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Crude oil price up more than 6 percent
The price of crude oil rose more than 6 percent, the biggest surge in 13 months, after Russia's prime minister said his country will support OPEC's plan to lower sales.
The remark followed indications from Saudi Arabian Oil Minister Ali al-Naimi yesterday that the Organization of Petroleum Exporting Countries next week may cut output quotas to the lowest since the Gulf War to lift prices from Tuesday's two-year low.
"If Russia joins in with OPEC, any chance of a price war is out the window," said Orrin Middleton, an energy analyst at Barclays Capital in London. Russia and OPEC pump almost half of the world's crude oil.
Dynegy to buy bigger rival
Energy marketer Dynegy Inc. announced yesterday that it will buy its much larger rival Enron Corp. for $7.8 billion in stock. The announcement came after Enron's stock plummeted about 80 percent in the past three weeks.
Under the deal ChevronTexaco Corp., which owns more than a quarter of Dynegy, would infuse about $1.5 billion. ChevronTexaco also would contribute an additional $1 billion upon completion of the deal.
Dynegy's current stockholders will own about 64 percent of the new company, with Enron's stockholders holding the remaining shares at closing.
Wholesale-level prices way down
Prices at the wholesale level plunged 1.6 percent in October, the biggest one-month drop ever, as gasoline and energy prices fell by the largest amount in 12 years, the government said yesterday.
The decline in the Labor Department's Producer Price Index, which measures cost pressures before they reach consumers, was the third this year and followed 0.4 percent increases in both August and September.
Analysts had expected wholesale inflation to retreat in October, given declines in energy prices, but the drop of 1.6 percent was four times what had been forecast.
American cuts more pilot jobs
American Airlines laid off 209 more pilots as the carrier continues to adjust to a 20 percent reduction in its flight schedule.
The pilots, whose furloughs took effect Nov. 1, are in addition to 386 American pilots and 120 at AMR's TWA Airlines LLC who lost their jobs Oct. 1.
AMR said Sept. 28 that it would eliminate about 20,000 jobs because of a drop in passenger traffic caused by the slowing U.S. economy and the Sept. 11 terrorist attacks.
