Oil prices increased as Hurricane Ida continued to hamper U.S. production, and traders bet on a tighter market through the end of the year.
- Futures surpassed $69 a barrel in New York after dropping the previous two consecutive sessions. Nearly 80% of U.S. Gulf of Mexico oil output remained shut in on Tuesday.
- The resulting disruption has seen the value of regional grades such as Mars Blend reach the highest since January.
- Carsten Fritsch, an analyst at Commerzbank AG, stated that oil prices are continuing to find support from the ongoing high production outages in the Gulf of Mexico.
- Supply concerns in Libya increased after demonstrators disrupted the loading of an oil tanker as a fresh series of protests at ports threatened to disrupt months of stability in the nation’s production and exports.
- On the demand side, there are random spikes in consumption emerging in some regions, including Europe, even though the fast-spreading delta variant of COVID-19 has led to renewed lockdowns.
Traders will get a picture on Thursday of Hurricane Ida’s impact on U.S. stockpiles. Gasoline inventories are likely to drop nearly about 3.7 million barrels last week. Crude supplies are also expected to drop by nearly 6 million barrels.
CL1! up +1.87%, BR1! up +1.45%Source: Bloomberg