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Oil prices move higher as storm threatens Gulf Coast

Oil prices rose on Monday as a tropical storm in the Gulf of Mexico prompted drillers to evacuate rigs and shut in production, although gains were muted by concerns about excess global supplies and falling fuel demand.U.S. West Texas Intermediate (WTI) crude futures CLc1 were trading up 14 cents, or 0.4%, at $37.47 a barrel by around 0629 GMT. Brent crude LCOc1 was 6 cents, or 0.2%, higher at $39.89 a barrel.

Both contracts ended last week lower, falling for a second week in a row.

Tropical Storm Sally gained in strength in the Gulf of Mexico west of Florida on Sunday and was poised to become a category 2 hurricane. The storm is disrupting oil production for the second time in less than a month after hurricane Laura swept through the region.

Typically oil rises when production is shut down, but with the coronavirus pandemic getting worse demand concerns are to the fore, while global supplies continue to rise. The U.S. is the world’s biggest oil consumer and producer.

In Libya, commander Khalifa Haftar committed to ending a months-long blockade of oil facilities, a move that would add more supplies to the market, although it was unclear if oil fields and ports would begin operations.

“The announcement that the blockade of Libyan oil export terminals may be about to end will add to the woes of OPEC+’s meeting this week,” said Jeffrey Halley, senior market analyst at OANDA.

Copied from: Ghana web

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