Oasis Petroleum, Southwestern Energy Stock Slumps As Susquehanna Cuts To Neutral

Shares of Oasis Petroleum Inc. slid 12% and shares of Southwestern Energy Co. lost 4% in midday trade, after Susquehanna cut both stocks to neutral from positive following the recent slide in oil prices. Analysts said they are lowering their oil price assumptions for 2015-16 to $60 to $70 a barrel from $77 to $85, and cutting their long-term assumption to $75 a barrel. They also lowered their natural gas price assumption to $3.35 to $3.65 per million British thermal units from $3.85 to $3.90. "For Oasis, leverage metrics expand significantly based on our new oil price assumptions," they wrote in a note. For Southwestern, "the prospects of completing a roughly $2 bn equity deal in a low gas price environment is likely to be a significant headwind. Most of the company's near-term growth is coming from northeast Marcellus, where wider basis differentials are limiting the company's cash flow growth," said the note.