Oil prices stable despite Hurricane Laura lockdown

London — Oil prices were broadly stable on Thursday as a huge hurricane in the Gulf of Mexico made landfall in the heart of the US oil industry, forcing oil rigs and refineries to shut down.

Brent crude futures for October, which expire on Friday, rose 6c, or, 0.1% to $45.70 a barrel by 9.42am GMT. The more active November Brent contract was virtually flat at $46.17 per barrel.

US West Texas Intermediate (WTI) crude futures fell 8c or 0.2% 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 64km inland from the sea.

On Tuesday, oil producers 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.

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

“The response of the oil price has been remarkably cool so far,” Commerzbank said. Oil prices also shrugged off US crude inventory declines and signs that petrol 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 (EIA) data showed on Wednesday. Petrol stocks also fell.

“It appears that the petrol inventory reduction was due first and foremost to increased demand — petrol demand rose to a six-month high of about 9.2-million bpd,” Commerzbank said.

Reuters