- OPEC+ expected to proceed with an output increase
- Hurricane Ida shuttered refiners on the U.S. Gulf Coast
- oil settles down 1% as U.S. refineries shut
- Washington pushes OPEC to pump more
Oil settled down 1% on Tuesday, posting its first monthly loss since March, as demand is expected to drop after Hurricane Ida shuttered U.S. Gulf refineries, Washington pushes OPEC to pump more says an article on Reuters.
Catastrophic damage
Hurricane Ida, which made landfall in the United States on Sunday as a Category 4 hurricane, knocked out at least 94% of offshore Gulf of Mexico’s oil and gas production and caused “catastrophic” damage to Louisiana’s grid.
Oil settles down 1%
Brent crude futures for October, due to expire on Tuesday, settled down 42 cents, or 0.6%, at $72.99 a barrel. U.S. West Texas Intermediate (WTI) crude futures settled down 71 cents, or 1%, at $68.50.
Offshore output to resume
About 1.7 million barrels per day (BPD) of offshore oil production was shut, but that output may resume more quickly than many refining operations along the Gulf that lost power. Analysts at FGE said in a Tuesday note they expect roughly three-quarters of offshore output to resume by the end of the week.
OPEC+ supply decision
Prices were pressured by concerns that power outages and flooding in Louisiana after Hurricane Ida will cut crude demand from refineries. OPEC and allied producers in OPEC+ had agreed to add 400,000 BPD to monthly supply until the end of December. Sources told Reuters the group is likely to maintain that plan despite U.S. pressure for more output.
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Source: Reuters
