Oil prices rise as Hurricane Delta approaches U.S. Gulf of Mexico

File – Chevron oil exploration drilling site near Midland, Texas, U.S. (Reuters)

SULAIMANI (ESTA) — Oil prices rose on Thursday as oil workers evacuated rigs in the U.S. Gulf of Mexico ahead of Hurricane Delta.

Brent crude futures rose 12 cents, or 0.12%, to $42.11 a barrel at 0619 GMT, after falling 1.6% on Wednesday. U.S. West Texas Intermediate (WTI) crude futures rose 4 cents, or 0.1%, to $39.99 a barrel.

With Hurricane Delta forecast to intensify into a Category 3 storm with winds of up to 120 miles per hour (193 km per hour), oil producers have evacuated 183 offshore facilities and halted nearly 1.5 million barrels per day (bpd), according to Reuters.

The Gulf of Mexico produced 1.65 million bpd in July, according to the U.S. government. The region, which accounts for 17% of U.S. crude production, has been hit by several storms over the past few months, each of which only briefly dented oil output.

The possibility that there will be no upcoming economic support measures comes as government data on Wednesday showed demand for oil at U.S. refineries is 13.2% lower than a year earlier, underscoring the plunge in fuel demand from the disruptions caused by the coronavirus pandemic.

“A piecemeal approach to U.S. fiscal stimulus is unlikely to alter a deteriorating demand outlook for oil,” ANZ commodities analyst Vivek Dhar said in a note.

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