The consequences of the hurricane continue to support oil prices

The price of oil continues to rise at the beginning of a new trading week amid investor concerns about limited production in the United States due to Hurricane Ida, as well as amid expectations of improved demand.

Brent crude futures rose to $73.65 per barrel, WTI – by 0.7% to $70.47 per barrel. Both contracts touched their maximum values since September 3 during the session.

Recall that as a result of Hurricane Ida, about three quarters of production on the shelf of the Gulf of Mexico has been stopped since the end of August. This is about 1.4 million barrels per day, which is approximately equal to the entire production of Nigeria, an OPEC member. Additional support for oil prices was provided by the fact that more and more refineries in Louisiana are resuming operations, and this increased the demand for crude oil.

This week, we should pay attention to the likelihood of a revision of the forecast of oil demand by OPEC and the International Energy Agency (IEA). The fact is that the increase in the incidence of coronavirus may force OPEC to revise its demand forecast for 2022 downward.