Oil steadies near $68 as storm headed for US seen lifting fuel prices
Hurricane Florence is likely to affect the Colonial Pipeline, the main conduit for moving gasoline and diesel from Houston to New York
Singapore: Oil held near $68 a barrel after four days of losses, as speculation swirled over whether a giant hurricane approaching the US East Coast would disrupt supplies and drive up fuel prices.
Futures in New York were little changed after slipping 3.3% in the past four sessions. While Hurricane Florence is likely to miss refineries in the Gulf Coast and Philadelphia areas, it could affect the Colonial Pipeline, the main conduit for moving gasoline and diesel from Houston to New York. Drivers may also fuel up before the storm, which could also potentially shut distribution terminals in the mid-Atlantic.
Tuesday’s relief for crude follows its longest losing streak since May as investors weighed a potential output increase from Saudi Arabia and Russia against the risk that US sanctions on Iran’s oil exports will lead to a supply crunch. Meanwhile, President Donald Trump’s unbending stance against China on trade is raising concerns that tensions between the nations will jeopardise global economic growth and hurt energy demand.
“The industry is focusing on Hurricane Florence, and while there are no refineries in the path of the storm, the Colonial Pipeline is prepping for possible power disruptions,” said Stephen Innes, Singapore-based head of trading for Asia Pacific at Oanda Corp. “It could lead to pressure at the pump in the northeast.”
West Texas Intermediate for October delivery traded at $67.60 a barrel on the New York Mercantile Exchange, up 6 cents, at 12:31 p.m. in Singapore. The contract dropped 21 cents to $67.54 on Monday. Total volume traded was about 65% below the 100-day average.
Brent for November settlement rose 15 cents to $77.52 a barrel on the ICE Futures Europe exchange. The global benchmark crude’s premium to WTI for the same month was at $10.07, increasing further after closing at the highest level in more than two months on Monday.
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