Oil rises nearly 3% as U.S. Gulf Coast braces for hurricane | Reuters

Oil rises nearly 3% as U.S. Gulf Coast braces for hurricane | Reuters:

Oil prices rose nearly 3% on Tuesday, supported by hurricane supply disruptions in the United States, but demand concerns loomed as energy industry forecasters predicted a slower-than-expected recovery from the pandemic.

Brent crude LCOc1 rose 98 cents, or 2.5%, to $40.59 a barrel by 1:01 p.m. EDT (1701 GMT), while U.S. West Texas Intermediate (WTI) crude futures CLc1 rose $1.07, or 2.9%, to $38.33 a barrel. Both contracts fell on Monday.

Futures gained ahead of Hurricane Sally’s expected landfall on the U.S. Gulf Coast. More than a fifth of U.S. offshore oil production was shut and key exporting ports were closed as the storm’s trajectory shifted east toward western Alabama, sparing some Gulf Coast refineries from high winds.

“Harsh weather events in the U.S. cause some unpredictability about its oil production and that’s always good news for prices,” said Bjornar Tonhaugen, Rystad Energy’s head of oil markets.