Oil prices seem to be coping with the continuing impact of Hurricane Harvey on the US oil, gas and associated industries.
In fact the greatest impact seems to be on the petrochemical sector and some refining, although US producers and imports are taking steps to minimise anything than short term dislocation, especially in gasoline (petrol).
Oil prices edged up Friday, but settled suffered a fifth-straight week loss as traders took the interruptions to be temporary, and that the slow fall in US stocks (and the impact of Harvey) hadn’t removed the global glut of oil and its associated products.
Gasoline (petrol) futures, meanwhile, eased back for the session, but still posted a gain of more than 13% for the week as refinery output remained crippled in the wake of the storm.
October West Texas Intermediate crude rose 6 cents, or 0.1%, to settle at $US47.29 a barrel on the New York Mercantile Exchange. Prices jumped 2.8% on Thursday but that wasn’t enough to offset falls earlier in the week.
As a result futures price ended the week with a loss of 1.2%, according to FactSet. That was after falls in each of the previous four weeks.
In London November Brent futures fell 11 cents on Friday, or 0.2%, to $US52.75, with the contract ending about 1.5% higher on the week.
Data released from Baker Hughes showed that the number of active US oil rigs unchanged for the week, but the company said it could not verify rig counts across 47 counties in South Texas because of the impact of Hurricane Harvey (and that’s where the Texas oil shale business is concentrated, especially in the Eagle Ford shale in the southeast).
Meanwhile natural gas for October bucked the trend among its peers to end 3 cents, or 1%, higher at $US3.07 per million British thermal units – up 5% for the week.
US government data Thursday showed a 30 billion-cubic-foot weekly rise in natural-gas supplies, “the smallest build for the comparable week going back to 2003,” said Richard Hastings, macro strategist at Seaport Global Securities.
The US government meanwhile released 500,000 barrels of oil from the strategic reserve and plans another 500,000 barrel release shortly to refineries in the Houston area
US crude stocks fell 5.39 million barrels last week to 457.8 million barrels. They are now 14.5% below the record levels hit in March.
OPEC output also fell in August by 170,000 barrels per day from a 2017 high in July, according to a Reuters survey found.
US crude production in the second last week on August was 9.530 million barrels a day, up just 2,000 barrels on the week before, but a massive 1.042 million barrels a day higher than a year ago. Over the latest four week period, US production is up 11.5% from a year earlier.
