On Thursday, oil prices soared due to various factors.
Brent crude surged by 3.2% or USD1.35 to USD43.34/barrel after posting a 1.6% slump on Wednesday while the US WTI accelerated by 3.1% or USD1.24 cents to USD41.19/barrel after Wednesday’s 1.8% fall.
The first factor supporting oil prices yesterday was the upcoming Category 3 storm Hurricane Delta in the US Gulf Coast which already halted almost 1.5 million barrels of daily output as the majority of the US Gulf of Mexico productions are being shut with workers evacuated.
The second factor would be a Dow Jones report, saying that Saudi Arabia is assessing to reverse the Organization of the Petroleum Exporting Countries (OPEC)’s planned production increase early in 2021. Some analysts view the potential extension of this year’s output cut pact would have positive impacts on the market.
Another factor propping oil prices was the prospect of prolonged oil workers’ strike in the North Sea which is estimated to threaten Norway’s oil and gas output by around 25%. Discussion between oil companies and Norway’s labor officials would be held on Friday, in search of an end to the strike that was started on Monday.
Looking ahead, Andrew Lipow, president of Lipow Oil Associates expected that Hurricane Delta could slash more than 5 million barrels of crude output in the US.
