Oil prices rise as a storm approaches the Gulf of Mexico
Crude is heading for weekly gains
Oil prices rose during trading on Friday, negatively affected by fears of supply disruptions, after several companies in the Gulf of Mexico stopped production and evacuated their employees, ahead of a storm coming from the Caribbean.
On the other hand, black gold prices are heading towards achieving gains of about 9% this week, in what may be the largest weekly jump since June 2020.
At 07:30 AM GMT, the price of Brent crude futures, for October delivery, rose by about 1.6 percent, recording $72.23 a barrel.
West Texas Intermediate crude contracts, for October delivery, rose by 1. percent, at $68.62 a barrel.
Supply disruption fears
Fears escalated about supply disruptions after several companies halted their production for fear of the Mexican storm, with expectations that it would hit the Gulf soon.
The companies began transferring workers from oil production platforms in the Gulf of Mexico, yesterday, Thursday, and (BHP) and (BP) announced that they would stop their production in offshore platforms, due to the storm forming in the Caribbean Sea on the Gulf soon.
The offshore wells of the Gulf of Mexico account for 17% of US oil production, 5% of dry natural gas production, and more than 45% of total US refining capacity is located along the Gulf Coast.
The possibility of disruption to US Gulf supplies diverted the market away from the losses it incurred on Thursday, which was caused, among other things, by the return of production in a Mexican oil platform after a fire that killed people, as well as fears of the consequences of the Corona virus and the delta axis, and comments by Federal Reserve officials about The central bank cut back its stimulus.
For his part, Chief Market Analyst at OANDA, Edward Moya, said that energy dealers are pushing crude prices higher, in anticipation of production disruptions in the Gulf of Mexico, and due to growing expectations that OPEC + may resist raising production given the impact of the recently mutated Delta strain on demand. on oil, according to Reuters.
Over the course of the week, oil contracts witnessed fluctuations, as they fluctuated between a rise of 2%, at the close of trading last Wednesday, on the back of the release of official US crude inventories data.
It also witnessed a decline, during Thursday’s trading, and oil prices deepened their losses by more than 1.5%, at the end of today’s trading, to record the first drop in 4 consecutive sessions, amid renewed concerns about demand recovery following the repercussions of the Corona virus.