Oil Flat After Laura Leaves a Weaker-Than-Expected Impact on Region’s Oil Infra
By Gina Lee
Investing.com – Oil was flat on Friday morning in Asia, after Hurricane Laura roared through Louisiana and Texas without causing any apparent major damage to the states’ oil infrastructure.
Brent oil futures was flat at $45.60 by 10:27 PM ET (3:27 AM GMT) and WTI futures inched down 0.09% to $43, giving up some Laura-related gains as producers calculate the damage and the shuttered infrastructure slowly reopens.
“Unless there is any lasting damage to oil production infrastructure, it would not be a surprise to see oil trade down a bit after the storm as damage assessment continues,” AxiCorp market strategist Stephen Innes said in a note.
As Laura made landfall on Thursday with 150-mile-per hour winds, the weaker-than-predicted storm surge spared the Gulf of Mexico’s rigs and refineries from the anticipated damage. More than 80% of the region’s production, as well as 15% of U.S. processing capacity, was shut down in preparation for Laura’s arrival, leading to an uptick in oil and gasoline prices earlier in the week.
The Port of Houston, a major U.S. crude oil export hub accounting for around 600,000 barrels per day (bpd) of shipments, was re-opened as of Friday. A Kpler estimate said that seaborne crude export capacity could be reduced by nearly 1 million bpd due to the earlier closures of Houston, Beaumont and Arthur ports.
Meanwhile, investors will now refocus their attention to COVID-19, and its impact on fuel demand recovery. But the pace of recovery remains slow, with diesel sales in the U.K. still at around 11% below pre-lockdown levels and half of India’s trucking fleet still grounded.
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