Oil Prices Rise as Hurricane Isaias Shuts 72% of US Gulf Production

By Adedapo Adesanya

Oil prices settled higher on Friday as Hurricane Isaias made ‌oil companies shut down more than 70 per cent of crude production in US waters.

Brent crude futures settled at $104.72, up 44 cents ⁠or 0.42 per cent, while the US West Texas Intermediate (WTI) crude finished at $91.85 a barrel, up 36 cents, or 0.39 per cent.

Hurricane Isaias knocked nearly 1.46 million barrels per day of US Gulf oil production offline, extending a rapid shutdown that began with just 185,120 barrels per day some days ago.

The US Marine Minerals Administration said on Friday that operators had shut in 1,458,814 barrels per day, or 71.51 per cent of current Gulf oil production, along with 1.26 billion cubic feet per day of natural gas, or 58.84 per cent of Gulf gas output.

That is another 176,000 barrels per day of oil production lost since Thursday, when the agency reported 1.28 million barrels per day offline.

According to reports, operators have now evacuated 129 production platforms, representing nearly 35 per cent of the 371 manned platforms in the Gulf.

Eight of 11 non-dynamically positioned drilling rigs have also been evacuated, while two of 17 dynamically positioned rigs have moved out of the storm’s path.

Earlier in the session, crude prices were down as US President Donald Trump said talks with Iran to end the war in the Middle East had been “productive.”

He said no attack was planned before the November 3 midterm congressional elections after media reports that he was considering an attack before then.

President Trump also teased an upcoming, undisclosed announcement on diesel and said he was considering suspending the federal tax on petrol.

On its part, Iran is ⁠reviewing the US response to its proposal that would reopen the Strait of Hormuz within seven days.

Despite this, the US is still pressuring Iran economically, imposing sanctions targeting individuals, networks and 17 vessels for transporting Iranian crude, oil products ⁠and petrochemicals.

The Iran war and the conflict between Russia and Ukraine have disrupted supplies of refined fuels such as gasoline, jet fuel and especially diesel fuel

Plans by China, the world’s top oil importer, to resume refined fuel exports after a brief halt during its Golden Week holiday also weighed on the market.