Crude prices rise on world markets

Share

The U.S. West Texas Intermediate crude October contract was at $49.05 a barrel by 3:10AM ET (0710GMT), down 11 cents, or around 0.2%.

Oil prices slid on Friday, with USA crude down more than 3 percent on worries that commerce and energy demand in Florida and the Southeast would be hit hard as Hurricane Irma, one of the most powerful storms in a century, drove toward the region.

Its predecessor, Harvey, shut a quarter of USA refineries and 8 percent of US oil production, with crude prices slumping as widespread refinery outages sharply reduced demand for crude.

Weekly crude oil inventory draws have still failed to climb with any significant meaning-a fact which has not deterred oil production in the U.S., which is climbing at a slow and steady pace, reaching 9.530 million bpd for the week ending August 25-about 380,000 bpd off from the most recent 2018 daily average proposed by the EIA's Short Term Energy Outlook of 9.91 million barrels.

The U.S. lost more than 20% of its refining capacity in the days after the storm but many refineries have since started to come back online.

Port and refinery closures along the Gulf coast and harsh sea conditions in the Caribbean have also impacted shipping.

"Nearly every refinery outside Louisiana and Texas is operating near full capacity", said Thomas Pugh, commodities economist at Capital Economics.

Money managers raised their net long U.S. crude futures and options positions in the week to September 5, the U.S. Commodity Futures Trading Commission (CFTC) said.

Saxo's Mr. Hansen cautioned that these are "temporary factors driving the market".

U.S. oil production dropped by nearly 8 percent, from 9.5 million barrels per day to 8.8 million bpd, according to the report of the Energy Information Administration (EIA).

Analysts expect the fallout from storm Harvey will continue to weigh on crude stockpiles as refiners have been slow to restart operations while the end of the summer driving season is traditionally associated with a dip in crude oil demand.

Outside the United States, ANZ said that the return of Libya's largest oil field to production was "less supportive" of prices. Analysts will be looking to see if the IEA adjusts its demand estimates.

But ICE gasoil, a benchmark for diesel fuel, changed hands at $532.50 a metric ton, up 1.7% from the previous settlement.

Share