By AEN Staff September 11, 2017 Read More →
Oil prices mixed as Harvey, Irma impacts still being assessed
Investors are waiting to see what impact Hurricane Irma will have on energy demand in Florida and oil prices. Reuters photo by Alexandre Meneghini.
Possible OPEC deal extension helps prop up oil prices
Oil prices were mixed in trading on Monday as investors weighed the impact of Hurricane Irma on energy demand in Florida and the extent of damage to oil refineries located on the US Gulf Coast caused by Hurricane Harvey in late August.
By 1:43 p.m. EDT, US WTI was up by 52 cents to $48/barrel and benchmark Brent was down 12 cents to $53.66/barrel.
Harry Tchilinguirian, global head of commodity markets at BNP Paribas told Market Watch that in a "dramatic situation" like a hurricane, there will be "a lot of volatility in the numbers."
Goldman Sachs said in a note on Monday that Irma's negative impact on oil demand will be smaller than Harvey "because Texas has twice the oil consumption per capita of Florida given the significant concentration of refining and petrochemical capacity on the U.S. Gulf Coast," they said.
"Harvey, as a result, had a significant negative impact on refineries and ethylene crackers utilization and their crude and [natural-gas liquids] feedstock demand," the analysts said.
Over the weekend, Saudi Arabia's Energy Minister, Khalid al-Falih met with his Venezuelan counterpart to discuss the possibility of extending the OPEC supply cut pact for an additional three months.
Falih also met with United Arab Emirates Energy Minister Suhail Mohamed Faraj Al Mazrouei on Monday. The two agreed to extend the pact beyond the March deadline.
Earlier this year, participants in the OPEC supply cut deal had agreed to extend the 1.8 million barrel per day production cut to March 2018 from its original end-date of June 2017.
JBC Energy said the OPEC deal extension talks will help prop up oil prices.
Investors and analysts are awaiting the Tuesday release of OPEC's production data and global demand forecasts as well as the US Energy Administration's monthly short-term energy outlook. On Wednesday, the US EIA will release its crude stock data.