By Peter Nurse
Investing.com -- Oil prices pushed higher Wednesday, helped by the continued disruption of output from U.S. Gulf of Mexico producers in the wake of Hurricane Ida.
By 9 AM ET (1300 GMT), U.S. crude futures were up 1.6% at $69.45 a barrel, while Brent futures were up 1.3% at $72.65 a barrel.
U.S. Gasoline RBOB Futures were up 1.1% at $2.1535 a gallon.
More than a week after Hurricane Ida made landfall on the south coast of the U.S., producers in the Gulf are still struggling to restart operations.
“According to the latest data from the Bureau of Safety and Environmental Enforcement, 1.44MMbbls/d of crude oil production remains shut in. This is equivalent to 79.33% of total US offshore GoM production,” said analysts at ING, in a note. “So far Hurricane Ida has resulted in 19.2MMbbls of production being lost, and with output still set to take a while to recover, these losses will only grow.”
Additionally, the U.S. National Hurricane Center on Tuesday said there was a 50% chance of a cyclone formation over the south-central Gulf of Mexico in the next 48 hours. This means the potential for even more disruption in the near future is high.
Attention now turns to the release of the inventory data from the American Petroleum Institute later Wednesday and then from the U.S. Energy Information Administration on Thursday as traders look for a more complete picture of the storm's impact on crude production and refinery output.
Still, despite these gains, there remain concerns about the spread of the Covid-19 virus and the potential impact on global growth.
China, the world’s largest oil importer, appears to have managed to contain its outbreak, but many countries in Asia are still suffering, resulting in mobility restrictions. Additionally, the fast-spreading delta virus variant has resulted in renewed lockdowns in some parts of Europe and the death toll in the U.S. topped 650,000 as children try to go back to school and companies attempt to bring employees back to the office.