Pummeling

The pummeling of oil and natural gas producer stocks, which began last week, continued Monday as the Dow Jones Industrial Average plunged 634 points on the first day of trading after Standard & Poor’s (S&P) late Friday downgraded the United States credit rating from “AAA” to “AA+.”

El Paso Corp. stock took a pummeling on Wall Street last week after the company lowered its earnings projections for 2002 and 2003 to accommodate a major cutback in its energy trading work force and other streamlining actions. The Houston-based energy giant plans to slash its trading staff, primarily the power side, by 50% in an attempt to ease the concerns of investors and credit rating agencies. The expected cost savings/proceeds from this and other moves, such as debt reduction and asset sales, will be channeled to El Paso’s core natural gas businesses — exploration and production (E&P), liquefied natural gas (LNG), and its midstream and pipelines facilities.