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Market News The market assesses the impact of the super hurricane, and U.S. oil closed above US$69 for the first time in the past two weeks

The market assesses the impact of the super hurricane, and U.S. oil closed above US$69 for the first time in the past two weeks

On August 30, U.S. oil futures rose by 0.47 U.S. dollars and settled at 69.21 U.S. dollars per barrel, closing above 69 U.S. dollars per barrel for the first time in more than two weeks. After the severe damage caused by Hurricane Ida, U.S. Gulf Coast The pipeline is coping with uncertainty about the timetable for the resumption of work. At the same time, the power outage has exacerbated the impact of the closure of refineries on the Gulf Coast. Traders weigh the possibility of prolonged production disruptions.

2021-08-31
10096
Monday (August 30) U.S. oil futures rose 0.47 US dollars, or 0.68%, and settled at 69.21 US dollars/barrel; cloth oil rose 0.71 US dollars, or 0.98%, to close at 73.41 US dollars/barrel, which was once high every day. A barrel of $73.69, the highest level since August 2. After the severe damage caused by Hurricane Ida, U.S. Gulf Coast platforms, refineries and pipelines are coping with uncertainty about the timetable for the resumption of work. At the same time, power outages have exacerbated the impact of the closure of Gulf Coast refineries. Traders are weighing long-term production. The possibility of being blocked.

Within 12 hours of making landfall, Ida weakened into a Category 1 hurricane, and then weakened into a tropical storm. Hundreds of oil production platforms were evacuated before the storm, and almost all offshore oil production in the Gulf of Mexico was suspended, equivalent to a shutdown of 1.74 million barrels per day. In contrast, the Louisiana refinery may be slower to resume production.

After strong winds and heavy rains, nearly 1.2 million homes and businesses in Louisiana and Mississippi lost power on Monday. The storm moved inland to shift the focus of the oil market to when refineries can resume work. Oil and gas pipeline operators are inspecting the damage caused by the storm. Electric utilities have warned that customers in the worst-hit areas may face long-term power outages. The power outage exacerbated the impact of the closure of refineries on the Gulf Coast, and traders weighed the possibility of prolonged production disruptions.

Patrick DeHaan, head of petroleum analysis at GasBuddy, a retail tracking agency, said that due to tight supply, the national average price of regular unleaded gasoline will climb to $3.18 per gallon this weekend. The impact of Hurricane Ida on the US oil industry may make this year's Labor Day the most expensive day for drivers to travel since 2014. US gasoline rose more than 1.5%, and rose more than 4% during the session, providing support for crude oil.

Ed Morse, global head of Citi's Commodity Research, said that he is bullish on oil prices in the next three months, but as US crude oil production rises, he is "very bearish" for 2022 and 2023. U.S. crude oil production has “really picked up,” and the market generally expects an increase of 600,000 barrels per day next year. After assessing the damage caused by Hurricane Ida, if the Louisiana Offshore Oil Port (LOOP) is interrupted for a long time, it will have an impact on the global oil market, and crude oil and refined oil prices may rise.

OPEC+ will hold a meeting on Wednesday to discuss the previously agreed 400,000 barrels/day production increase plan. OPEC representatives said that they expected to advance the plan, or limit the increase in oil prices. However, the Kuwaiti Petroleum Minister said on Sunday that he may also reconsider, and investors will then turn their focus to OPEC+ meetings that may increase supply.

(U.S. oil daily chart)
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