HURRICANE HURTS OIL SUPPLY

OIL ROSE more than 1 percent yesterday as US Gulf of Mexico producers made slow progress in restoring output after Hurricane Ida and protesters blocked exports from two Libyan ports.

Brent was up $1.06, or 1.5 percent, at $72.75 (about R1 038) a barrel at 3.40pm, and US West Texas Intermediate crude rose $1.18, or 1.7 percent, to $69.53 a barrel.

“Oil prices are continuing to find support from the ongoing high production outages in the Gulf of Mexico,” said Commerzbank analyst Carsten Fritsch.

Producers in the Gulf were still struggling to restart operations nine days after Hurricane Ida swept through the region with powerful winds and drenching rain.

About 80 percent of US Gulf production remained offline on Tuesday, with 79 production platforms still unoccupied. About 17.5 million barrels of oil have been lost to the market so far. The Gulf’s offshore wells make up about 17 percent of US output.

“Refinery operations appear to be making a quicker recovery,” ING analysts said in a note.

Only about 1 million barrels per day (bpd) of capacity was temporarily closed, down from a peak of more than 2 million bpd, ING said, citing the latest situation report from the Department of Energy.

“However, those refiners that have restarted are unlikely to be operating at full capacity at the moment,” the note added.

In Libya, protesters blocked oil exports at the ports of Es Sider and Ras Lanuf, an oil engineer at each port said, although other engineers said production at fields that supply the terminals was unaffected.

Meanwhile, the UN atomic watchdog criticised Iran for stonewalling an investigation into past activities and jeopardising important monitoring work, possibly complicating efforts to resume talks on reviving a nuclear deal.