Oil prices slip as Hurricane Laura's blow unlikely to have sustained impact


  • Energy
  • Friday, 28 Aug 2020

Brent crude futures for October, which expire on Friday, fell US55 cents, or 1.2%, to settle at $45.09 a barrel. U.S. West Texas Intermediate (WTI) crude futures fell 35 cents or 0.8% to $43.04 a barrel. Oil producers on Tuesday had shut 1.56 million barrels per day (bpd) of crude output, or 84% of the Gulf of Mexico's production, evacuating 310 offshore facilities.

NEW YORK: Oil prices eased on Thursday as the market expected a quick recovery for production platforms shuttered ahead of a hurricane that churned through the Gulf of Mexico and slammed Louisiana.

Brent crude futures for October, which expire on Friday, fell US55 cents, or 1.2%, to settle at $45.09 a barrel. U.S. West Texas Intermediate (WTI) crude futures fell 35 cents or 0.8% to $43.04 a barrel.

The storm hit Louisiana early Thursday with 150 mile-per-hour (240 kph) winds, damaging buildings, knocking down trees and cutting power to more than 400,000 people in Louisiana and Texas. Its storm surge was less than predicted, sparing inland plants from feared flooding.

Oil producers on Tuesday had shut 1.56 million barrels per day (bpd) of crude output, or 84% of the Gulf of Mexico's production, evacuating 310 offshore facilities.

BP said Thursday it was already preparing to return to its company-operated facilities in the deepwater Gulf of Mexico to inspect for any potential damage from the storm.

At the same time, refiners that convert nearly 2.33 million bpd of crude oil into fuel, and account for about 12% of U.S. processing, halted operations.

"On the one hand refinery shutdowns reduced the demand for crude oil, but at the same time Gulf of Mexico production was shut in, nearly offsetting each other," said Andrew Lipow, president of Lipow Oil Associates in Houston.

Exxon Mobil Corp said it was contacting employees of its 369,000 barrel-per-day oil refinery and chemical plant in Beaumont, Texas, and preparing a preliminary tally of damages. The large plant was one of six plants along the Gulf Coast's refinery row that shut this week ahead of the storm.

"These guys have gone through these drills many times," said Jennifer Rowland, senior analyst at Edward Jones in St. Louis. "They know how to turn those units down and get them back up within a number of days...it shouldn’t be that big of an impact, ” she added.

- Reuters
Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 1
Cxense type: free
User access status: 3
Subscribe now to our Premium Plan for an ad-free and unlimited reading experience!

Oil price , US , Hurricane , Laura , coronavirus , Brent , WTI ,

   

Next In Business News

Swift Haulage acquires Singapore-based Watt Wah Petroleum for RM5.17mil
TNG, Shell expects 200 shell stations to be equipped with TNG RFID solutions by year-end
MAHB, Capital A drop legal proceedings against each other
Sunway Resort completes phase one renovation project worth US$60mil
Hit by rising costs, Hup Seng Industries' profit falls 15%
FBM KLCI falls as investors brace for US inflation report; Hartalega tumbles
Malaysia Airlines to acquire 20 Airbus A330neos - sources
Oil slips as U.S. crude stockpiles rise, eyes on U.S. inflation data
Thailand hikes rate for first time since 2018 to tame hot inflation
UOB Malaysia introduces UOB Infinity to corporate clients

Others Also Read