CALGARY - Shares of Canada's biggest oilsands companies posted solid gains on the stock market Wednesday amid reports that two of the world's richest men -- Warren Buffet and Bill Gates -- made a surprise visit to Alberta's oilsands earlier this week.
Suncor Inc. (TSX:SU), Canada's oldest oilsands company, gained $3.62 to close at $59.89, a jump of 6.4 per cent, in trading of nearly five million shares on the Toronto Stock Exchange.
Meanwhile, Canadian Natural Resources (TSX:CNQ), Canada's second-largest oil and gas producer, rose $6.13 to $88.40, a gain of 7.5 per cent in trading of nearly 7.5 million shares.
Canadian Natural hosted the Gates and Buffet tour on Monday at its $9.3-billion Horizon oilsands project north of Fort McMurray, Alta., which is currently being developed.
Greg Stringham, vice-president at the Canadian Association of Petroleum Producers, says the two men asked the industry body to give a general overview of the oilsands and Canada's position in the energy world.
The oil sector stock gains Wednesday came as world crude prices fell to the US$113-a-barrel level after the U.S. government reported a massive increase in U.S. crude supplies amid a slowdown in fuel demand.
The Energy Information Administration, an arm of the U.S. Energy Department, said crude inventories rose by a hefty 9.4 million barrels in the week ended Aug. 15, after a big gain in imports. The figure came in much higher than the average analyst forecast for a 1.7 million-barrel increase, according to energy information provider Platts.
However, gasoline inventories shrank by a larger-than-expected 6.2 million barrels to below-average levels, the EIA said, while distillate inventories -- which include heating oil and diesel fuel -- rose by less than expected.
The TSX energy sector was up over four per cent late Wednesday and the September crude contract closed up 45 cents to US$114.98. Crude prices were very volatile, swinging between $112.61 and US$117.03.
Avery Shenfeld, senior economist at CIBC World Markets, said traders "seem to be focusing on the gasoline demand number within it and ignoring the very large buildup of crude oil on the week.
"It's surprising crude is holding in with such a strong inventory build."
As for the Gates-Buffet trip, Shenfeld said: "That's a very popular trip for all sorts of people to take (in the investment community)."
"People who are interested in the future of oil in North America have trekked up to the oilsands to see what they look like."
Bill Harris, energy and mining specialist at Avenue Investment Management in Toronto, said the world fuel supply situation had more of an impact on the oilpatch trading than the oilsands tour.
"Everybody thought the oil price was coming down and the oil market is relatively tight," said Harris. "We're just having a bounceback because everything was insanely negative two days ago."
Among other major Canadian oilsands operators, EnCana Corp, (TSX:ECA) rose $3.85 to $76.12, a gain of 5.3 per cent in trading of 4.3 million shares.
Canadian Oil Sands Trust, (TSX:COS.UN) the biggest partner in the world's biggest oilsands project, Syncrude, gained $1.42 to $50.26, up 2.9 per cent in trading of more than 1.7 million shares.
Petro-Canada (TSX:PCA), meanwhile, closed at $46.45, up $1.28 or almost three per cent, on nearly 2.9 million shares traded. Its oilsands properties include the 100 per cent-owned MacKay River project.
And Nexen Inc. (TSX:NXY), which is developing its Long Lake project in the Athabasca oilsands region, rose $1.93 to $33,10, a gain of 6.4 per cent on a volume of 4.1 million shares.
