MELBOURNE: Oil prices rose on Wednesday, paring overnight losses, with producers in the US Gulf of Mexico struggling to restart operations nine days after Hurricane Ida swept through.
US West Texas Intermediate (WTI) crude futures rose 27 cents, or 0.4%, to $68.62 a barrel at 0204 GMT, after sliding 1.4% on Tuesday following the Labor Day holiday.
Brent crude futures inched up 14 cents, or 0.2%, to $71.83 a barrel, after falling 0.7% on Tuesday.
“The market is … weighing up the impact of ongoing delays to the resumption of operations in the Gulf of Mexico,” ANZ Research analysts said in a note.
About 79% of US Gulf production remained offline on Tuesday, with 79 production platforms still unoccupied more than a week after Hurricane Ida made landfall. About 17.5 million barrels of oil has been lost to the market so far.
The Gulf’s offshore wells make up about 17% of US output.
Traders will be closely watching inventory data from the American Petroleum Institute industry group due on Wednesday and the US Energy Information Administration on Thursday for a clearer picture of the storm’s impact on crude production and refinery output.
Analysts polled by Reuters expect, on average, that crude stocks dropped by 3.8 million barrels in the week to Sept. 3, and see gasoline stocks down by 3.6 million barrels and distillates down by 3 million barrels.
Oil prices fell on Tuesday in a widespread commodity sell-off as the US dollar jumped on worries about rising COVID-19 cases in the United States and Asia potentially slowing growth.