MEXICO CITY, Aug 27 (NNN-AGENCIES) — Oil prices rose on Friday, on track to post big gains for the week, on worries about near term supply disruptions as energy companies began shutting in production in the Gulf of Mexico ahead of a potential hurricane forecast to hit on the weekend.
U.S. West Texas Intermediate (WTI) crude futures climbed 16 cents, or 0.2per cent, to US$67.58 a barrel at 0111 GMT, clawing back a 1.4per cent loss on Thursday. WTI is headed for a weekly gain of more than 8per cent, which would be its strongest rise since early February.
Brent crude futures similarly rose 16 cents, or 0.2per cent, to US$71.23 a barrel, after falling 1.6per cent on Thursday.
Brent is on track for a rise of more than 9per cent this week, its biggest weekly jump since June 2020 mostly on relief that China has contained an outbreak of the Delta variant.
Companies started airlifting workers from Gulf of Mexico oil production platforms on Thursday and BHP and BP said they have begun to stop production at offshore platforms as a storm was brewing in the Caribbean Sea, forecast to barrel through the Gulf on the weekend.
Gulf of Mexico offshore wells account for 17per cent of U.S. crude oil production and 5per cent of dry natural gas production. Over 45per cent of total U.S. refining capacity lies along the Gulf Coast.
The prospect of U.S. Gulf supply outages helped turn the market around from losses on Thursday, which had been partly spurred by output returning at a Mexican oil platform following a fatal fire.
“The market may have more immediate concerns, with a storm building in the Caribbean. It’s expected to become a powerful hurricane and potentially wreak havoc in the Gulf of Mexico and Texas early next week,” ANZ Research said in a note. — NNN-AGENCIES
