Oil Hits Five-month Highs As U.S. Producers Cut Output Ahead Of Hurricane

22Views

August 26, 2020

NEW YORK: Crude oil prices rose to a five-month high on Tuesday as U.S. producers shut most offshore output in the Gulf of Mexico ahead of Hurricane Laura even as rising coronavirus cases in Asia and Europe capped gains.

Brent futures rose 73 cents, or 1.6%, to settle at $45.86 a barrel, while U.S. West Texas Intermediate (WTI) crude rose 73 cents, or 1.7%, to settle at $43.35.

That was the highest closes for both benchmarks since March 5, the day before Saudi Arabia and Russia failed to agree on a new plan to cut output and about a week before the World Health Organization declared COVID-19 a pandemic.

U.S. producers cut crude output ahead of Hurricane Laura at a rate approaching the level of 2005’s Hurricane Katrina and also halted most oil refining along the Texas/Louisiana coast.

Laura is expected to strengthen into a major hurricane with 115 mile per hour (185 kph) winds before it strikes the coast near the Texas-Louisiana border early Thursday, according to the U.S. National Hurricane Center.

On Tuesday, producers had evacuated 310 offshore facilities and shut 1.56 million barrels per day (bpd) of crude output, 84% of Gulf of Mexico’s offshore production, near the 90% outage that Katrina brought 15 years ago.

“Today’s strength was again almost entirely attributable to storm concerns,” said Jim Ritterbusch, president of Ritterbusch and Associates in Galena, Illinois, noting the storm factor would likely overshadow the weekly storage report from the U.S. Energy Information Administration (EIA).

Analysts forecast U.S. crude stockpiles fell for a fifth week in a row last week, according to a Reuters poll conducted ahead of reports from the American Petroleum Institute (API) at 4:30 p.m. (2030 GMT) on Tuesday and the government on Wednesday.

“Overall, hurricanes may be limiting supply this week … but the market will soon again focus on the biggest hurricane of them all, COVID-19,” said Bjornar Tonhaugen, head of oil markets at Rystad Energy.

Europe is seeing a rise in coronavirus cases, including re-infection. Two re-infections were reported in Europe and one in Hong Kong.

Elsewhere, U.S. and Chinese trade officials reaffirmed their commitment to a Phase 1 trade deal.

Also Watch

Internet’s New Obsession: A Viral Mashup Of ‘Kokilaben Grilling Gopi Bahu’

(Additional reporting by Julia Payne in London and Jessica Jaganathan in Singapore; Editing by Marguerita Choy and Richard Chang)

Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor

Array
(
[videos] => Array
(
[0] => Array
(
[id] => 5f4549e97c39367400f9e0d0
[youtube_id] => tD9e28qx6xg
Oil Hits Five-month Highs As U.S. Producers Cut Output Ahead Of Hurricane => Internet’s New Obsession: A Viral Mashup Of ‘Kokilaben Grilling Gopi Bahu’
)

[1] => Array
(
[id] => 5f453d3debd3817406544116
[youtube_id] => TzooTD3KXj0
Oil Hits Five-month Highs As U.S. Producers Cut Output Ahead Of Hurricane => Russia Looks To India For Partnership, Should India Bet On Sputnik V? | Brass Tacks | CNN News18
)

)

[query] => https://pubstack.nw18.com/pubsync/v1/api/videos/recommended?source=n18english&channels=5d95e6c378c2f2492e2148a2,5d95e6c278c2f2492e214884,5d96f74de3f5f312274ca307&categories=5d95e6d7340a9e4981b2e10a&publish_min=2020-08-23T01:19:14.000Z&publish_max=2020-08-26T01:19:14.000Z&sort_by=date-relevance&order_by=0&limit=2
)

Oil Hits Five-month Highs As U.S. Producers Cut Output Ahead Of Hurricane

Also Watch

Speak Your Mind

LEAVE A REPLY Cancel reply

Get in Touch

Recommend for You

Oh hi there It’s nice to meet you.

Subscribe and receive our weekly newsletter packed with awesome articles that really matters to you!

You might also like

EDITOR PICKS

POPULAR POSTS

POPULAR CATEGORY

About Us

Follow Us

Support Us & Be a Patreon

Add QNewsHub to your Homescreen!

Oh hi there
It’s nice to meet you.