Oil rises as US producers and refiners assess storm damage

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NEW YORK: Oil prices rose on Monday as oil rig operators and refiners assess damage to their facilities on the US side of the Gulf of Mexico amid uncertainty over the timeframe for resuming operations after Hurricane Ida hit the region.

The gains were limited by expectations that the OPEC + group would press ahead with a planned increase in oil production.

The global benchmark Brent crude contracts ended the trading session up 71 cents, or 0.98 percent, to settle at $73.41 a barrel, after touching during the session its highest level since August 2, at $73.69.

US crude futures rose 47 cents, or 0.68 percent, to close at $69.21 a barrel.

Within 12 hours of making landfall, Ida weakened to a Category 1 hurricane and subsequently retreated to a tropical storm. Hundreds of oil production platforms were evacuated ahead of the storm and nearly all US oil production from the Gulf of Mexico, or 1.74 million barrels per day, was halted.

US gasoline contracts jumped more than 1.5 percent, giving support to crude.

Brent is 40 percent higher than its level at the beginning of the year, supported by supply cuts from OPEC and its allies, in what is known as the OPEC + group, and some recovery in demand from the collapse sparked by the pandemic last year.

OPEC + meets on Wednesday to discuss a planned increase of 400,000 barrels per day in its oil production, in what will be another easing of record production cuts it implemented last year.

OPEC delegates say they expect the group to press ahead with increasing production, although Kuwait’s oil minister said on Sunday that it might be reconsidered.

(Reuters)

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