Oil prices mixed as storms hit US Gulf output

Singapore — Crude oil prices were mixed on Tuesday as traders weighed huge production cuts in the US Gulf Coast from tropical storms Marco and Laura against rising coronavirus cases in Asia and Europe.

Brent crude oil futures added 9c, or 0.2%, to $45.22 a barrel by 4.20am GMT, while US West Texas Intermediate crude was down 9c, or 0.2%, at $42.53 a barrel.

“A jump last week in the US rig count and mixed data on Covid-19 infections are having a muted negative effect on oil this week, thanks in part to the possible disruption from two separate hurricanes moving into the US Gulf Coast region,” said Stephen Innes, chief global markets strategist at AxiCorp.

Energy companies moved to cut production at US Gulf Coast oil refineries on Monday after shutting 82% of the area’s offshore crude oil output as the rare double-storm assault on US oil regions threatens to bring days of heavy rains and strong winds this week.

Producers have shut more than 1.5-million barrels a day of Gulf Coast offshore oil production, nearly 14% of the nation’s total output.

A US infectious diseases expert warned on Monday that rushing out vaccines could undermine trials of other promising candidates, following a boost to markets after US regulators authorised the use of blood plasma from recovered Covid-19 patients as a treatment option.

Europe is also seeing a rise in coronavirus cases while the first documented case of human reinfection with Covid-19 was reported with a man in Hong Kong catching the virus again four months after first being infected.

Elsewhere, US and Chinese officials, who spoke by phone on Monday, see progress on resolving issues over the phase one trade deal agreed in January and both sides are committed to the success of the agreement, the US trade representative’s office said.

Meanwhile US crude oil stockpiles were likely to have fallen for a fifth straight week, while refined product inventories also decreased last week, a preliminary Reuters poll showed.


Source: businesslive.co.za