Oil prices were broadly stable on Thursday as a massive hurricane in the Gulf of Mexico made landfall in the heart of the U.S. oil industry, forcing oil rigs and refineries to shut down.
Brent crude LCOc1 futures for October, which expire on Friday, rose 6 cents, or, 0.1 per cent to $45.70 a barrel by 0942 GMT. The more active November Brent contract LCOc2 was virtually flat at $46.17 per barrel.
U.S. West Texas Intermediate (WTI) crude CLc1 futures fell 8 cents or 0.2 per cent to $43.31 a barrel.
Hurricane Laura made landfall early on Thursday in southwestern Louisiana as a category 4 storm, one of the most powerful to hit the state, with forecasters warning it could push a wall of water 40 miles inland from the sea.
Oil producers on Tuesday had shut 1.56 million barrels per day (bpd) of crude output, or 84 per cent of the Gulf of Mexico’s production, evacuating 310 offshore facilities.
At the same time, refiners that convert nearly 2.33 million bpd of crude oil into fuel, and account for about 12 per cent of U.S. processing, halted operations.
“The response of the oil price has been remarkably cool so far,” Commerzbank said.
Oil prices also shrugged off U.S. crude inventory declines and signs that gasoline demand in the world’s biggest oil consumer were improving.
Crude oil stockpiles fell last week as exports soared the most in 18 months and refineries boosted production to the highest rate since March, Energy Information Administration data showed on Wednesday. Gasoline stocks also fell. [EIA/S]
“It appears that the gasoline inventory reduction was due first and foremost to increased demand – gasoline demand rose to a six-month high of around 9.2 million bpd,” Commerzbank said.