Oil Prices Recover on Hurricane Supply Disruption Fears
Oil prices climbed more than 1% on Wednesday, paring some of the previous day's losses, as concerns about Hurricane Francine disrupting output in the United States, the world's biggest producer, outweighed worries about weak global demand.
Brent crude futures were up 84 cents, or 1.2%, to $70.03 a barrel at 0704 GMT, while U.S. crude futures were at $66.56 a barrel, up 81 cents, or 1.2%.
Both benchmarks fell nearly $3 on Tuesday, with Brent hitting its lowest since December 2021 and WTI falling to a May 2023 trough, after OPEC revised down its demand forecast for this year and 2025.
Francine strengthened into a hurricane in the Gulf of Mexico, the U.S. National Hurricane Center said on Tuesday, prompting Louisiana residents to flee inland and oil and gas companies to shut production.
About 24% of crude production and 26% of natural gas output in the U.S. Gulf of Mexico were offline due to the storm, the U.S. Bureau of Safety and Environmental Enforcement (BSEE) said on Tuesday.
On Tuesday, the Organization of the Petroleum Exporting Countries (OPEC) cut its forecast for world oil demand to rise by 2.03 million barrels per day (bpd) in 2024, from last month's forecast for growth of 2.11 million bpd, it said in a monthly report.
OPEC also cut its 2025 global demand growth estimate to 1.74 million bpd from 1.78 million bpd.
But the U.S. Energy Information Administration (EIA) said on Tuesday global oil demand is set to grow to a bigger record this year while output growth would be smaller than prior forecasts.
Source : Reuters
