Suara.com – World oil prices shot to their highest level. This increase was triggered by the slow production of the United States (US) after being hit by Hurricane Ida.
The price increase came despite the Organization of the Petroleum Exporting Countries (OPEC) cutting its forecast for world oil demand for the final quarter of 2021 due to the Delta variant of the coronavirus.
Quoting CNBC, Tuesday (14/9/2021) Brent crude futures, the international benchmark, closed up 59 cents, or 0.8 percent, to 73.51 dollars per barrel.
Meanwhile, US benchmark West Texas Intermediate (WTI) crude futures jumped 73 cents, or 1.1 percent, to settle at 70.45 dollars a barrel.
Also Read: US Stocks Thin, World Oil Prices Rise High
It was Brent’s highest close since July 30 and WTI’s highest close since August 3.
“The impact of Hurricane Ida lasted longer than market expectations, and as some oil production capacity remains closed this week, prices are rising given that supply has not recovered, therefore not reaching refineries that have restarted operations faster than producers,” said Nishant Bhushan, analyst. at Rystad Energy.
Further disruption from bad weather may be imminent, with America’s National Hurricane Center projecting Tropical Storm Nicholas will erode along the South Texas coast Monday, and make landfall near Corpus Christi Monday evening local time.
Royal Dutch Shell begins evacuating staff from a US Gulf of Mexico oil rig, and other companies begin preparing for hurricanes.
While OPEC said a further recovery in oil demand would be delayed until next year when consumption exceeds pre-pandemic levels, analysts noted OPEC and its allies, including Russia, the group known as OPEC Plus, are still increasing output.
Also Read: China Will Release National Reserve, World Oil Prices Fall to Lowest Values
In addition to the OPEC demand forecast, other bearish factors weighed on Monday’s surge in oil prices, including a rise in U.S. shale production, a potential increase in supply from a planned release of oil from strategic reserves in the United States and China, and the possibility Iran could more closely resell its supply.
U.S. oil production from seven major shale formations is expected to increase by about 66,000 bpd in October to 8.1 million bpd, the highest level since April 2020, according to the Energy Information Administration’s monthly drilling productivity report.
Traders noted the planned release of oil from China’s strategic reserves could increase the available supply in the world’s second-largest oil consumer.
The US government agreed to sell crude from the state’s emergency reserves to eight companies including Exxon Mobil, Chevron and Valero, under an auction scheduled to raise money for the federal budget.
The latest hopes for talks on a broader nuclear deal between Iran and the West came after the United Nations atomic watchdog reached an agreement with Iran on Sunday to keep monitoring equipment serviced.
Source: Suara.com – Berita Terbaru Bisnis, Ekonomi, Investasi Indonesia by www.suara.com.
*The article has been translated based on the content of Suara.com – Berita Terbaru Bisnis, Ekonomi, Investasi Indonesia by www.suara.com. If there is any problem regarding the content, copyright, please leave a report below the article. We will try to process as quickly as possible to protect the rights of the author. Thank you very much!
*We just want readers to access information more quickly and easily with other multilingual content, instead of information only available in a certain language.
*We always respect the copyright of the content of the author and always include the original link of the source article.If the author disagrees, just leave the report below the article, the article will be edited or deleted at the request of the author. Thanks very much! Best regards!