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Oil markets move little with industry in grip of Caribbean hurricanes

Published 2017-09-07, 09:57 p/m
© Reuters.  Oil markets move little with industry in grip of Caribbean hurricanes
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By Henning Gloystein

SINGAPORE, Sept 8 (Reuters) - Oil prices were little changed on Friday as the international petroleum industry remains in the grip of Caribbean hurricanes which have pummelled the region for the last two weeks.

U.S. West Texas Intermediate (WTI) crude futures CLc1 were at $49.16 barrel at 0154 GMT, 7 cents above their last settlement.

Brent crude futures LCOc1 , the benchmark for oil prices outside the United States, were up 11 cents to $54.60 a barrel.

"The oil market was little changed, as the recovery from Hurricane Harvey stalled at the same time that Hurricane Irma threatened to disrupt the sector in Florida," ANZ bank said.

Hurricane Harvey hit the U.S. Gulf coast two weeks ago, knocking as much as a quarter of the country's huge refinery industry, as a result of which demand for crude oil - refining's lifeblood - fell sharply.

As of Thursday, about 3.8 million barrels of daily U.S. refining capacity, or about 20 percent, was still shut. U.S. Energy Information Administration (EIA) said on Thursday that refinery utilisation rates slumped 16.9 percentage points to 79.7 percent last week, the lowest rate since 2010.

That left a lot of crude unused, with commercial U.S. inventories rising 4.6 million barrels last week, to 462.35 million barrels. C-STK-T-EIA

However, U.S. oil production also hit, with weekly output down from 9.5 million bpd to 8.8 million bpd. C-OUT-T-EIA

Port and refinery closures along the Gulf coast and harsh sea conditions in the Caribbean have also impacted shipping.

"Imports (of oil) to the U.S. Gulf Coast fell to levels not seen since the 1990s," ANZ said.

Traders said it would take weeks for the U.S. petroleum industry to return to full capacity, and that under the current conditions it was difficult to identify fundamental market trends.

"The data for this week and next will be taken with a grain of salt as the underlying trend will be obscured by the effects of the hurricane," said William O'Loughlin, investment analyst at Rivkin Securities.

Even as the oil industry continues to grapple with the fallout from Harvey, a much bigger Hurricane was lashing the Caribbean islands and heading for the United States.

Hurricane Irma, which has become one of the biggest storms ever measured - picking up the Twitter hashtag #irmageddon - early on Friday was over the Dominican Republic and Haiti, heading for Cuba and the Bahamas. It was predicted to hit Florida on Sunday or Monday.

The U.S. National Hurricane Center (NHC) said that Irma was still a Category 5 Hurricane, with wind speeds of 175 miles per hours (280 km/h). GRAPHIC: U.S. crude inventories & production

http://reut.rs/2j8Ao6V MAP: Hurricane Irma

http://reut.rs/2ePEUGi Interactive Map

reuters://REALTIME/verb=Interactive%20Map/context=%3CNavigation%3E%3CEntities%3E%3CEntity%3E%3CInteractiveMap%20version=%221%22%3E%3CMap%3E%3CMapTargetZoom%3E4%3C/MapTargetZoom%3E%3CMapTargetCenter%20X=%22-73.0709381%22%20Y=%2226.04692305%22%20/%3E%3CMapMode%3E2%3C/MapMode%3E%3CWrapAround%3ETrue%3C/WrapAround%3E%3CLayers%3E%3CLayer%20Type=%22TropicalTracks%22%3E%3CCurrent%3Eall%3C/Current%3E%3C/Layer%3E%3CLayer%20Type=%22SatelliteAndRadar%22%3E%3CCurrent%3Eall%3C/Current%3E%3C/Layer%3E%3C/Layers%3E%3C/Map%3E%3C/InteractiveMap%3E%3C/Entity%3E%3C/Entities%3E%3C/Navigation%3E

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