Oil equipment and services exchange traded funds followed the broader stock indicators higher after U.S. regulators found that BP (NYSE: BP) was not solely at fault for the oil spill in the Gulf of Mexico last year.
Oil Services HOLDRS (NYSEArca: OIH), iShares Dow Jones U.S. Oil Equipment & Services Index Fund (NYSEArca: IEZ) and Energy Select Sector SPDR Fund (NYSEArca: XLE) were up about 2% on Wednesday.
According to a recent report issued by a U.S. probe, greater diligence from Halliburton Co (NYSE: HAL) and Transocean (NYSE: RIG) would have reduced the likelihood of the blowout occurring, reports Anna Driver for Reuters. Halliburton shares initially plummeted in early trading before climbing back into the green.
The federal investigation concluded that all three companies violated federal safety regulations leading up to last year’s massive oil spill, reports Neela Banerjee for The Los Angeles Times. The federal agency will further determine actions and penalties for the violations.
“The loss of life at the Macondo site on April 20, 2010, and the subsequent pollution of the Gulf of Mexico through the summer of 2010 were the result of poor risk management, last‐minute changes to plans, failure to observe and respond to critical indicators, inadequate well control response, and insufficient emergency bridge response training by companies and individuals responsible for drilling at the Macondo well and for the operation of the Deepwater Horizon,” the Bureau of Ocean Energy Management found.
Oil Services HOLDRS
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Max Chen contributed to this article.