Volatile oil and natural gas prices, along with a growing concern that interest rates are moving up, appeared to send U.S. stocks down across the board for the third straight day Monday, with some prices at their lowest level in a year. Only a few energy companies — integrateds and utilities — posted any gains, while the producers took the biggest hit.

On Monday, Saudi Arabia’s oil minister called on other oil producing nations to increase crude production, which shot down exploration and production (E&P) stocks worldwide, including those based in the United States. In afternoon trading, nearly all of the majors and independents were down at least 2%, but most had lost close to 4% of their value.

Mississippi-based Callon Petroleum was the only gainer among E&Ps, with a 2 cent gain. Meanwhile, Nuevo Energy was down about 7.7%, nearly the same as Fort Worth-based Range Resources. Magnum Hunter lost about 6.5% of its value on the day, and XTO Energy, with most of its production also centered in North America, was down almost 7% in heavy trading. Cabot Oil & Gas was down more than 4%, while Chesapeake Energy lost more than 5% of its value as well.

Some of the larger U.S.-based independents fared no better — Apache Corp. was off about 4.30%, or $1.94, while Anadarko Petroleum Corp. was off $2.10, or nearly 4%. Burlington Resources was down more than 4% for the day, and Devon Energy Corp.’s share price was off almost 6%.

It’s not only oil production and the fear of higher interest rates pulling the market down, according to Barry Ritholtz, chief market strategist at New York-based Maxim Group. He cites four factors to the disruption: the Iraq war, which appears to be going from bad to worse; a perception that President Bush is now vulnerable; the backlash against U.S. companies operating overseas because of the Iraqi prisoner-abuse scandal; and Federal Reserve Chairman Alan Greenspan’s warning about the U.S. deficit being an obstacle to economic growth.

“The market is throwing a tantrum because of the number of unpleasant things in the next six months,” Ritholtz said.

A.G. Edwards & Sons analysts noted that U.S. corporate earnings have been strong, but the combination of possibly higher interest rates and the anxiety over Iraq is sending U.S. stocks down.

In a weekly report, Rod Smyth, chief investment strategist at Wachovia Securities, wrote that “stocks tend to do best when investors expect economic acceleration, for example, a year ago. Looking forward from today, investors are dealing with the prospect of higher interest rates, persistently higher energy prices and political uncertainty.”

Two sectors particularly vulnerable to a hike in interest rates are bank stocks and utilities, “which suffer in a rising rate environment,” according to a note by Lord, Abbett & Co.

“It is because of this consideration, though not it alone, that Lord, Abbett’s equity portfolios currently underweight financials significantly. Utilities, too, are rate sensitive and underweighted in part to guard against the ill effects of expected rate hikes.”

Of the utilities and integrated energy companies, there were a few notable gainers, including Allegheny Energy, which posted its first quarterly profit in more than two years and added almost 70 cents, or about 5.25% in its share price Monday. Entergy Corp. also posted a 14-cent gain. Delta Natural was up 23 cents, and Energy West gained around 20 cents on the day.

For the rest of the utility and integrated sector, however, the numbers were red. Laclede was down nearly $1, losing more than 3% of its value, while Atmos Energy was down around 30 cents. Duke Energy had lost about 38 cents, while Southern Co. was off 12 cents. Southwestern Energy Co. lost 5.49% of its value, while Westar was off more than 4%.

Among the larger U.S. natural gas pipeline operators, only Avista posted a small 2 cent gain, while El Paso Corp., which had managed a small gain early in the day, lost it by market’s close. Williams Cos., which launched a tender offer on Monday to pare down its debt, was down around 10 cents, Dominion was off $1, or about 1.60%, and Sempra Energy was down 83 cents, or more than 2%. Northern Border also lost about 4.5% of its value on the day, to end off about $1.70.

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