Wall Street is giving mixed marks to Gulf Oil Corp.'s planned takeover of Cities Service Co. Analysts said yesterday that the acquisition of Citgo would give Gulf some badly needed additional crude oil and natural gas reserves, but at a cost of significantly lower earnings as Gulf pays the $4.9 billion purchase price.

"In the long run, it may be a good move," said Sanford Margoshes, an analyst at Bache Halsey Stuart Shields. "But, in the short run, it really doesn't enhance the holdings of Gulf shareholders."

"Clearly the incentive to Gulf is that they're buying U.S. oil and gas reserves at a fairly reasonable price," said Alvin Silber, who follows the company for Dean Witter Reynolds. "I think the investment community is perceiving the near-term earnings potential as negative."

The stock market expressed its dissatisfaction with Gulf's move by bidding the company's stock down $3.87 1/2 to $27.50 a share in heavy trading on the New York Stock Exchange yesterday. Cities Service stock jumped $11.25 to $53.25 a share.

And Standard & Poor's, a debt-rating service, announced that it was putting Gulf's senior debt issues and commercial paper on its "credit-watch" list of companies whose securities might be subject to a ratings change. "An inclusion of $5 billion in debt on its balance sheet would significantly weaken the company's capital structure," S&P said.

Gulf and Cities Service announced Thursday that they had agreed to a proposal under which Gulf would pay $63 a share for Citgo's 77.9 million shares. The merger, which still must be approved by shareholders of both companies, would be the third largest corporate combination and would move Gulf to seventh place on the list of largest American industrial companies.

The proposed deal also appears to stymie Mesa Petroleum Co.'s maverick bid to grab control of Cities Service, which is 20 times Mesa's size. Mesa is offering $45 a share for a 15 percent stake in Citgo and has been trying for three weeks to line up financing to go after a larger chunk of the company. Citgo, however, said it will continue to press its own plans to acquire Mesa.

Gulf has had a reputation in the oil industry in recent years as being "crude poor," that is, as having limited reserves of oil and gas. The company's reserves at the end of last year were enough to last Gulf about seven years at present production levels; "crude-rich" companies such as Standard Oil Co. of Ohio and Atlantic Richfield Co. have about twice as much reserve capacity.

Gulf's reserve woes have been exacerbated by its loss of virtually all of its crude oil supply from Kuwait, which now sells the Pittsburgh-based company just a fraction of the 500,000-barrel-a-day supply it used to get.

Because of the Kuwait experience, Gulf has been seeking for the past couple of years to concentrate its reserves in the United States, and has been searching for another oil company to acquire to bolster its oil holdings.

Cities Service, based in Tulsa, produces the majority of its oil and gas domestically, and has about 10 years worth of reserves. Silber estimates that Gulf's acquisition of Cities would increase Gulf's oil reserves by about 15 percent and its gas reserves by about 50 percent. Cities Service also has 10.6 million acres of undeveloped domestic acreage compared with Gulf's 13.7 million.

But the cost of interest alone on the $4.9 billion deal will reduce Gulf's earnings by about $2 a share annually, Silber estimated.

Meanwhile, officials of the Federal Trade Commission, which will evaluate the proposed merger for possible antitrust violations, said the commission is likely to focus on how a merger of the two companies would affect regions in which both have marketing operations.

In Tulsa, Cities Service President Robert Chitwood told reporters that his company and Gulf see no "unsolvable" antitrust problems with the proposed merger.

Congressional sources said the proposed combination of Gulf and Citgo could revive efforts in Congress to put limits on the size of corporate mergers, particularly those involving oil companies.

And Sen. Howard Metzenbaum (D-Ohio), an outspoken critic of such mergers, said Gulf's takeover of Citgo would "further reduce competition in an industry in which the free market is already under siege. . . . I suspect that the proposed merger is motivated simply by the desire of the big to get bigger."