SINGAPORE – Oil prices climbed on Wednesday after crude stocks showed a more than expected fall in the United States, the world’s biggest oil consumer, and on hopes that demand will recover as vaccine roll-outs widen. .
But the decline in China’s crude inflows in August with daily refineries is the lowest since last May, and overall factory output falters, limiting growth in oil prices.
Brent crude oil was up 54 cents, or 0.7 per cent, at $74.14 a barrel by 0659 GMT, while US West Texas Intermediate (WTI) crude was up 53 cents, or 0.8 per cent, at $70.99 a barrel.
U.S. crude oil, gasoline and distillate stocks all fell last week after Hurricane Ida shut several refineries and offshore drilling production, citing data from the American Petroleum Institute on Tuesday. [API/S]
Crude oil stocks fell by 5.4 million barrels in the week ended September 10. Analysts were expecting an average drop of 3.5 million barrels.
Edward Moya, senior analyst at OANDA, said, “The impact of Hurricane Ida was much greater than many anticipated and production in the Gulf of Mexico region may struggle to return unless Tropical Storm Nicolas penalizes the region with torrential rains. does.”
Tropical Storm Nicholas moved slowly off the Gulf Coast on Tuesday, leaving hundreds of homes and businesses without electricity, although Texas refineries continued to operate as normal.
The damage from Nichols comes just two weeks after Hurricane Ida knocked a significant amount of refining capacity offline in the Gulf Coast.
Meanwhile, the vaccine roll-out is poised for a rebound, after a three-month slump in global oil demand due to the spread of the delta version of the coronavirus and renewed pandemic restrictions, the International Energy Agency (IEA) said on Tuesday. Also helping to raise prices.
Details on China’s plans to sell crude from strategic reserves put pressure on prices, however, China’s State Reserves Administration said it would auction 7.4 million barrels of crude on September 24.
“The big question mark is what the next wave will be like, but there is growing optimism that each (coronavirus) wave will be less severe as more countries get vaccines,” Moya said.
“Oil markets remain in deficit and supply disruptions in the US should support prices in the near term.”
by Jessica Jagannathan
This News Originally From – The Epoch Times