MOSCOW (MRC) -- Crude oil futures were higher in mid-morning trade in Asia Sept. 14 on concerns about tight supply in the US during hurricane season and OPEC+ strengthening its demand outlook for 2022, reported S&P Global.
At 10:25 am Singapore time (0225 GMT), the ICE November Brent futures contract was up 32 cents/b (0.44%) from the previous settle at USD73.83/b, while the NYMEX October WTI contract was up 36 cents/b (0.51%) at USD70.81/b.
"Crude oil gained amid signs of further supply disruptions. Prices have been rising as the US oil industry struggles to get back on its feet following Hurricane Ida," ANZ research analysts said in a note Sept. 14. About 44% of capacity was still offline and efforts to restore output may be delayed by another storm, they added.
Supply concerns were compounded by the emergence of Tropical Storm Nicholas on the Texas Gulf Coast as neighboring Louisiana and US Gulf of Mexico oil and gas producers continue to pick up from the devastation of Hurricane Ida two weeks ago.
However the National Hurricane Center said Nicholas, with maximum sustained winds of 60 mph, was expected to be more of a rain event as it makes landfall in the coming hours, unlike Ida with Category 4 winds. There were few reports of refinery shutdowns ahead of Nicholas, with most refiners on the Texas coast and in western Louisiana monitoring the storm's progress and implementing preparedness plans.
Around 793,522 b/d or 43.6% of Gulf of Mexico output remains shut in following Ida, the US Bureau of Safety and Environmental Enforcement said Sept. 13.
Meanwhile OPEC+ in its latest monthly report has forecast oil demand to grow by 4.15 million b/d in 2022, increasing from 3.28 million b/d in last month's report. It now estimates demand to reach 100.83 million b/d for the year, driven by a stronger than expected recovery in fuel demand and a steady economic outlook in all regions.
As informed earlier, Shell said it observed damage from Hurricane Ida to its transfer station West Delta-143 offshore facilities in the Gulf of Mexico. West Delta-143 serves as the transfer station for all production from its assets in the Mars corridor in the Mississippi Canyon area of the Gulf of Mexico to onshore crude terminals. Shell said it is not yet safe to send personnel offshore to learn the full extent of the damage and estimate the effect on production.
We remind that in late August, 2021, US crude stocks dropped sharply while petroleum products supplied by refiners hit an all-time record despite the rise in coronavirus cases nationwide, the Energy Information Administration said. Crude inventories fell by 7.2 million barrels in the week to Aug. 27 to 425.4 million barrels, compared with analysts' expectations in a Reuters poll for a 3.1 million-barrel drop. Product supplied by refineries, a measure of demand, rose to 22.8 million barrels per day in the most recent week. That's a one-week record, and signals strength in consumption for diesel, gasoline and other fuels by consumers and exporters.
We also remind that US crude oil production is expected to fall by 160,000 barrels per day (bpd) in 2021 to 11.12 million bpd, the US Energy Information Administration (EIA) said in a monthly report, a smaller decline than its previous forecast for a drop of 210,000 bpd.
MRC