Oil prices rose 2 percent today, posting the biggest weekly gain in more than a year, as energy companies began halting US production in the Gulf of Mexico before a major hurricane is expected to strike early next week.
Brent crude futures rose $1.63, or 2.3 percent, to settle at $72.70 a barrel, while US West Texas Intermediate crude rose $1.32, or two percent, to a settlement price of $68.74.
This is the highest close for Brent since August 2 and for WTI since August 12.
On a weekly basis, Brent rose more than 11 percent, and West Texas Intermediate rose more than ten percent, the largest weekly percentage gains for both since June 2020.
According to Reuters, Edward Moya, senior market analyst at OANDA, said: “Energy traders are pushing crude oil prices higher in anticipation of production disruptions in the Gulf of Mexico and in light of rising expectations that OPEC may curb production increases given the recent impact of the Delta strain on crude demand.”
Oil producers today shut down 59 percent of crude production in the Gulf of Mexico as the storm approaches toward major US offshore oil fields, according to the Office of Safety and Environmental Enforcement.
US oil rigs rose five to 410 this week, the highest level since April 2020, Baker Hughes Energy Services said. In August, energy companies added 25 oil rigs, the most in a month since January, raising the rig count by 12 months. for the first time since July 2017.