The Gulf of Mexico storm hits again, and U.S. oil closes above US$70 for the first time in nearly six weeks
US oil futures rose by US$0.73 on September 13 and settled at US$70.45/barrel. This is the first time the contract has closed above US$70/barrel in the past six weeks. Two weeks after Hurricane Ida hit the Gulf Coast, US oil production Recovery is slow, and worry that another storm this week may affect Texas oil production, providing support for rising oil prices

Monday (September 13) U.S. oil futures rose by US$0.73, or 1.1%, and settled at US$70.45/barrel, the highest closing price since August 3; Bulk oil rose by US$0.59, or 0.8%, and reported It closed at $73.51 per barrel, the highest closing price since July 30. Two weeks after Hurricane Ida hit the Gulf Coast, U.S. oil production has been slow to recover, and it is worried that another storm this week may affect Texas oil production and provide support for rising oil prices.
According to data from the U.S. Security and Environmental Enforcement Agency, as of September 13, the Gulf of Mexico region closed 43.6% of crude oil production (or 793,000 barrels per day) and 51.61% of natural gas production (or 1151.01 million cubic feet per day). ). After Hurricane Ada, a total of 47 oil and natural gas production platforms are still evacuated.
Severe weather may be about to bring further damage. The National Hurricane Center expects Tropical Storm Nicholas to strike along the southern coast of Texas on Monday and make landfall near Corpus Christi later tonight. Royal Dutch Shell began to evacuate workers on an oil platform in the U.S. Gulf of Mexico on Monday, and other companies also began to prepare for hurricane-level winds brought by the second Gulf of Mexico storm in a few weeks.
Rystad Energy crude oil market analyst Nishant Bhushan said, “The impact of Hurricane Ida lasted beyond market expectations. Some oil production capacity was still closed this week, and oil prices are rising. Because supply has not yet recovered, the speed of resumption of work is faster than that of oil producers. Of oil refineries are unable to obtain sufficient supplies."
With crude oil prices steadily rising this month, major Wall Street banks are assessing the prospects of the crude oil market. Goldman Sachs Group said that with strong demand and "increasing scarcity" of supply, crude oil may lead the rise of commodities in the next quarter. Bank of America believes that if the winter temperature is lower than expected, it may push oil prices to $100 at some point early next year.
The U.S. Energy Information Administration's (EIA) monthly drilling productivity report released on Monday showed that U.S. shale oil production in October is expected to increase by approximately 66,000 barrels per day to 8.1 million barrels per day, the highest since April 2020. The Permian Basin, which produces the largest shale oil, has the largest increase. Data shows that crude oil production in this area is expected to increase by 53,000 barrels per day in October to 4.8 million barrels per day, the highest since March last year. Production in most other shale oil producing areas is expected to remain stable or increase slightly. As oil prices rebounded to $70/barrel, drilling activities by energy companies continued to increase. Overall, as of August, the number of active oil and gas drilling rigs in the United States has increased for 13 consecutive months.
On the demand side, the Organization of the Petroleum Exporting Countries (OPEC) on Monday lowered its global oil demand forecast for the last quarter of 2021. It is estimated that the average oil demand in the fourth quarter of 2021 will be 99.7 million barrels per day, which is lower than the previous month’s estimate. 110,000 barrels per day. Due to the raging delta variant virus, OPEC said that further recovery will be postponed until next year, when crude oil consumption will exceed the level before the epidemic.
The estimated demand growth in 2022 was adjusted to 4.15 million barrels per day, compared with 3.28 million barrels per day in the previous month’s report. OPEC sources revealed that the organization estimated it at 420 at its last meeting on September 1. Ten thousand barrels per day. OPEC said, “At present, it is believed that the recovery of crude oil demand will be stronger, mainly in 2022. With the increase in vaccination rates, it is expected that the new crown epidemic will be better controlled, and economic activities and human logistics will be firmly restored. To the level before the epidemic."
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