Oil remained unchanged in the early trading session today, following a two-day decline following Hurricane Ida, which still affected U.S. crude oil production three weeks after it reached land.
Futures in New York rose close to $ 71 a barrel after losing more than 3% in the last two sessions. Royal Dutch Shell said production from two of its largest deposits in the Gulf of Mexico would not resume until next year due to damage from Ida. The market is also focused on the global energy crisis, especially for natural gas, which could increase demand for crude oil.
Oil has managed to recover some profits over the past four weeks, in part due to a tightening of the market following prolonged disruptions in supplies from the Gulf of Mexico storm. U.S. crude oil inventories are expected to fall by more than 3 million barrels last week, according to a Bloomberg study that would reduce inventories to unprecedented lows by 2018.
The shutdown of Shell, the largest U.S. oil producer in the Persian Gulf, will disrupt and slow production by about 300,000 barrels of daily production capacity, according to Bloomberg Intelligence, or one in six barrels pumped in the region. The outage is forcing refineries and other buyers to look for alternative supplies.
Junior Trader Nikolay Petrov