## Oil Prices Rise Amid Lower U.S. Crude Inventories and Gulf Hurricane
Oil prices saw an uptick on Wednesday as industry data revealed a significant decrease in U.S. crude oil reserves and the looming threat of a Gulf hurricane kept investors on edge. According to the American Petroleum Institute, crude stockpiles in the U.S., the world’s largest fuel consumer, fell by a larger-than-expected 11.5 million barrels in the week ending August 25.
Additionally, the ongoing approach of Hurricane Idalia in the Gulf of Mexico has heightened market anxiety. The region contributes approximately 15% of U.S. oil production and 5% of natural gas production, according to the Energy Information Administration.
## Prices Increases Across the Board
The October Brent crude futures, which are set to expire on Thursday, rose by 42 cents, or 0.49%, to $85.91 a barrel by 0748 GMT. Meanwhile, the more active November contract was priced at $85.32, up by 41 cents. U.S. West Texas Intermediate crude futures also saw a rise of 50 cents, or 0.62%, bringing the price to $81.66.
Both benchmarks experienced a rally of more than a dollar on Tuesday as the U.S. dollar weakened following the release of softer U.S. job data, which indicated a potential slowdown in interest rate hikes.
## Impacts of Global Events on Oil Prices
In addition to domestic factors, global events also influenced oil prices. For instance, the military coup in Gabon could potentially disrupt the country’s crude supplies, tightening the market even further. Gabon has been exporting an average of 160,000 barrels per day to Asia from May to July, according to Kpler ship-tracking data.
Analysts also anticipate that Saudi Arabia, the world’s largest oil exporter, will continue its voluntary output cut into October, keeping oil supply tight. Based on this assumption, refining sources surveyed by Reuters predict that Saudi Arabia’s official selling prices for all crude grades sold to Asia in October will reach their highest point this year.
However, concerns over fuel demand and China’s mixed economic position, the world’s largest oil importer, have put a cap on oil’s gains.
## Market Watch Amid Global Events
As the global oil market continues to navigate through uncertainties, investors are closely monitoring the situation. From the potential impact of Hurricane Idalia on U.S. oil and gas production, to Saudi Arabia’s voluntary output cut and the military coup in Gabon, the oil market remains at the mercy of these events. Meanwhile, the decrease in U.S. crude inventories signals a strong demand, adding another layer of complexity to the oil market’s future trajectory.
Original Story at www.reuters.com – 2023-08-30 08:05:12