Crude rises over $1/bbl on US storm fears

27 August 2008 11:16  [Source: ICIS news]

LONDON (ICIS news)--Crude prices rose by more than a $1/bbl on Wednesday, ahead of the US stock data scheduled for release later in the day, to take Brent crude on London’s ICE Futures close to $116/bbl on the back of a tropical storm threatening to hit oil facilities in the Gulf of Mexico and a dip in the US dollar.

 

By 9:45 GMT, October Brent crude had hit a high of $115.84/bbl, a gain of $1.21/bbl over the Tuesday close of $114.63/bbl, before easing back to around $115.80/bbl.

 

At the same time, October NYMEX crude was trading around $117.65/bbl, having hit a high of $117.71/bbl, a gain of $1.44/bbl over the previous close.

 

Tropical Storm Gustav which hit Haiti was forecast to regain strength and could turn into a hurricane and therefore still pose a threat to oil facilities in the Gulf of Mexico.

 

Another factor placing upward pressure on oil prices was the US dollar easing against the euro, after having reached its highest value in the last six months against the European currency. This retreat was largely due to profit-taking.

 

Moreover, later in the afternoon, the markets were expected to focus on the release of the US weekly stock data. Analysts were anticipating a 1m bbl increase in oil inventories and 500,000 bbl increase in distillates. However, gasoline stocks were expected to drop 2.9m bbl.

By: Giovanni Coiro
+44 20 8652 3214

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