Oil prices settled higher for the third day in a row on Wednesday, and edge higher on Thursday morning as the refinery activity resumed on the Gulf Coast, following the disruptions caused by Hurricane Harvey last week.
Crude oil prices rose on Tuesday and Wednesday, with WTI climbing 1.03% by 4:15pm EST to $49.16, and Brent prices increasing by 1.59% to $54.23.
Hurricane Irma hit the Dominican Republic and Haiti on Friday, heading for Cuba and the Bahamas.
Weekly crude oil inventory draws have still failed to climb with any significant meaning-a fact which has not deterred oil production in the United States, which is climbing at a slow and steady pace, reaching 9.530 million bpd for the week ending August 25-about 380,000 bpd off from the most recent 2018 daily average proposed by the EIA's Short Term Energy Outlook of 9.91 million barrels.
According to Reuters, as of yesterday, about 3.8 million bpd in refining capacity remained shut down, representing a fifth of the USA total.
U.S. gasoline stockpiles shrank last week as refineries were shuttered as Hurricane Harvey approached the Texas coast and the offloading of imported cargoes was interrupted.
"Hurricanes can have a lasting effect on refinery and industry demand", said Eugen Weinberg, head of commodities research at Commerzbank in Frankfurt.
West Ham vs Huddersfield Preview in Monday Night Football
They were achieved by scorelines of - in order they were played - 1-0, 1-0, 1-0, 1-0, 3-0, 1-0, 1-0. For me, it's not logical to be under pressure after three games, but it's modern football".
Bloomberg news agency reported that as of September 8, only 8 percent of the oil refining capacity remained withdrawn after the Hurricane Harvey.
"Irma looks like it will miss the key Gulf areas, and we're more anxious about shale", said Mark Watkins, regional investment manager at U.S. Bank. With U.S. Gulf Coast ports and refineries out of commission, European and Asian refiners have had to increase production, elevating their demand for crude supplies.
The Department of Homeland Security said it is waiving the Jones Act for a week, which will allow fuel to be shipped by foreign-flagged vessels instead of only US -flagged vessels to help ensure that emergency responders during Irma and in the wake of Harvey have enough motor fuel. Prices lost 7 cents to close at US$49.09 on Thursday.
But Mr. Pugh said it was only a question of "when, not if" USA crude demand would rebound.
Futures were little changed in NY, up 3.7% for the week. In the previous week, speculators had cut their bullish bets to a two-month low as Harvey made landfall.