Oil gains on Gulf of Mexico outages as US releases crude from reserve
Overall output in the basin declined by 240,000 barrels, according to government data
Oil prices advanced on Friday amid prolonged outages from producers in the Gulf of Mexico that led the White House to authorize the release of 1.5 million barrels of crude to Exxon Mobil to produce gasoline.
Brent crude futures were up 0.8 percent to $73.54 a barrel, while US West Texas Intermediate crude futures were gained 0.5 percent to $70.36 a barrel. Both benchmark oil contracts were little changed in the week.
About 1.7 million barrels per day of oil production remains shut in the US Gulf of Mexico, with damage to heliports and fuel depots slowing the return of crews to offshore platforms, sources told Reuters.
Overall Gulf of Mexico output declined by 240,000 barrels, according to government data.
The output losses would further deplete US stocks, which are 15 percent below year-ago levels.
Fuel and power shortages have hampered recovery. About 860,000 homes and businesses in Louisiana lacked power. More than a third of gasoline stations in the state were without fuel, according to tracking firm GasBuddy.
The shortages included aviation fuel for helicopters that conduct post-hurricane aerial evaluations and ferry workers to and from platforms. Ida’s winds crushed fuel depots and helicopter pads used by transport firms.
Royal Dutch Shell, the largest Gulf of Mexico producer, has resumed 20 percent of its usual production, the company said. An offshore facility that carries offshore oil and gas to shore suffered damage, it said.
Pipeline operator Enbridge said it continues to evaluate its Gulf of Mexico facilities and offshore production remained shut.
Damages to offshore oil facilities could cost insurers about $1 billion, estimated CoreLogic.
Separately, Chevron is looking to sell its oil and gas assets in Eagle Ford basin in south Texas for as much as $3.8 billion, according to sources familiar with the matter and a marketing document seen by Reuters.