Hurricane Laura affected Louisiana and Texas, but causing no any widespread damage to the US oil industry. Prices dropped on Friday as the oil companies resumed their operations.
Some 300 offshore production facilities closed. Nine refineries capped off, having approximately 2.9 million barrels of capacity or 15% of US processing capacity, before the Category 4 storm hit the Louisiana coast with a 150 mph (240 km / h) speed of wind. Closed offshore crude oil production in the northern Gulf of Mexico said to be84.3%, or 1.55 million barrels per day (bpd).
Efforts continued Friday to reestablish operations on the US Gulf Coast offshore platforms and refineries closed by Hurricane Laura, as energy companies and oil markets largely unaffected by the impact of the storm. Many companies said they have started to allocate personnel to all assets that are not or partially affected by storms in the Gulf of Mexico.
Late Thursday, the Port of Houston, the largest crude oil export hub in the US, shipping about 600,000 barrels per day, was in the process of reopening for commercial shipping.
Brent crude futures LCOc1 for October fell 4 cents to settle at $45.05 a barrel, before expiring on Friday. West Texas Intermediate (WTI) crude CLc1 fell 7 cents to $42.97 a barrel. U.S. gasoline futures were up about 3 cents, 2% higher than a week ago.
Both benchmarks were up about 1.5% on a weekly basis and WTI rose for the fourth week in a row. Benchmarks reached a five-month high during the week when US producers reduced crude oil production at a rate close to Hurricane Katrina in 2005 ahead of Laura.
The oil trade stood out with strong advances earlier in the week as significant storm premiums were pumped into the market prior to Hurricane Laura. Following the arrival of the storm, its limited influence on the open sea largely erased the premium provided by the hurricane.
Unlike the stock markets, the oil market did not even react to the weak dollar, with an unusually long spell of low volatility. There has been rarely such little fluctuation over such a long period, especially given the dynamic situation on the demand and supply side.
US energy firms kept the number of oil and gas rigs operating this week unchanged. This caused the first monthly increase since December as higher crude oil prices caused some producers to start drilling again.
Meanwhile, the downward trend in demand expectations continues. With Brent crude for close delivery, the six-month later contango (LCOc1-LCOc7) remained close to its largest level since late May, with a front-month contract cheaper than $ 2.
Everyone except Saudi Arabia is confident that global oil demand will not return to 2019 levels until at least 2022. The latest monthly estimates from strong international official sources show that consumption cannot return to pre-pandemic levels before than a year time of period.