Oil set for first weekly gain since July

Hong Kong - Oil headed for the first weekly gain since July as Gulf Coast refiners ramp up crude processing after disruptions from Hurricane Harvey.

Futures were little changed in New York, up 3.7% for the week. About 8% of US refining capacity remains shut after Harvey first made landfall two weeks ago, according to data compiled by Bloomberg. Almost a quarter of the nation’s capacity was halted following the storm. American crude stockpiles rose by 4.58 million barrels last week, the first gain since the end of June.

While refineries, pipelines and offshore platforms resume operations after Harvey, another Atlantic hurricane, known as Irma, is approaching the US coast and is set to hit Florida on Sunday. Imports into the Gulf Coast region last week fell to the lowest in records going back to 1990 and nationwide crude output fell below 9 million barrels a day for the first time since February.

“The return of refining is underpinning the strength in oil at the moment,” said David Lennox, an analyst at Fat Prophets in Sydney. “The market is watching Irma to see what happens there. Outside of the hurricanes, stable US crude output is keeping the price from rallying too high.”

West Texas Intermediate for October delivery was at $49.06 a barrel on the New York Mercantile Exchange, down 3 cents, at 08:52. Total volume traded was about 20% below the 100-day average. Prices lost 7c to close at $49.09 on Thursday.

Brent for November settlement added 12c to $54.61 a barrel on the London-based ICE Futures Europe exchange. Prices gained 29c to $54.49 on Thursday and are 3.5% higher this week. The global benchmark traded at a premium of $5.12 to November WTI.

Gulf Coast imports dropped by 41% last week to 1.48 million barrels a day, the lowest volume since at least January 1990, according to a report from the Energy Information Administration on Thursday. Nationwide crude output slid by 749 000 barrels a day to 8.78 million a day.

Oil-market news:

Limetree Bay Terminals’ St. Croix oil terminal in the US Virgin Islands has been shut since Tuesday evening because of Hurricane Irma, according to a person familiar with the operations.

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