On Thursday, oil prices failed to maintain its upward trend amid the threat from Hurricane Laura to the Gulf of Mexico, the heart of the US oil industry as demand has been low while inventories are especially high.
By 01.48 GMT, US WTI crude oil futures slid by 0.1% or 4 cents to USD43.35/barrel, erasing the slight rise from Wednesday.
The Brent crude futures for October set to expire on Friday climbed by 5 cents to USD45.69/barrel after tumbling by 0.5% or 22 cents yesterday, while the more active November Brent contract inched up by 2 cents to USD46.18/barrel.
Earlier this week, the threat from the hurricane buoyed the prices. However, oil stockpiles are not seen to be heavily impacted and remain high as fuel demand is hit by the coronavirus pandemic.
In the week ended August 21, US crude stockpiles posted a bigger decrease than expected by 4.7 million barrels, but the number was still high at 507.8 million barrels.
National Australia Bank’s head of commodity research, Lachlan Shaw commented that the market was not shaken as hard as expected due to the slump in demand and higher inventories than normal.
In the hurricane’s expected most affected area, the Gulf of Mexico, oil producers have shut 84% of the area’s crude output or 1.56 million bpd and evacuated 310 offshore facilities. Nine refineries were also closing down temporarily, which halted 2.9 million bpd or 15% of US processing capacity.
