Oil prices steady as traders assess US hurricane impact
SEOUL (Reuters) – Oil prices were steady Tuesday, as traders weighed up the dampening effect on demand of Hurricane Irma versus refinery restarts in the wake of Hurricane Harvey that should lead to more crude oil processing.
International benchmark Brent crude was down four cents, or 0.07 percent, at $53.80 per barrel by 0655 GMT from the previous close.
US West Texas Intermediate crude was down three cents, or 0.06 percent, at $48.04 a barrel.
US refineries, including the largest US refinery Motiva Enterprises, have started to come back online. Motiva restarted production on Monday after being shut for about two weeks as Hurricane Harvey ripped through the US Gulf coast.
On Harvey’s heels, Hurricane Irma slammed into Florida on Sunday, leaving more than 7.4 million homes and businesses without power, but has since been downgraded to a tropical storm.
US crude inventories likely rose last week following the hurricane impact, while refined product stockpiles were forecast to have declined, a preliminary Reuters poll showed.
Six analysts polled ahead of inventory reports from industry group the American Petroleum Institute (API) and the US Department of Energy’s Energy Information Administration estimated, on average, that crude stocks likely rose 2.3 million barrels in the week ended Sept. 8.
“The market is looking for a significant build in oil inventories,” said Ric Spooner, chief market analyst at CMC Markets in Sydney. “That’s not surprising given the disruption of refineries as consequences of hurricanes, so I guess there’s a bit of caution here.”
As mixed market indicators kept oil prices in a range, RBC Capital Markets said in a note that it expected “WTI and Brent to average $49.30 and $52.50 per barrel this year before increasing to average $53 and $55.50 a barrel next year.”