Top Oil Prices Surge as Hurricane Francine Disrupts U.S. Gulf of Mexico Production
By Shariq Khan
Oil prices soared on Friday as output disruptions in the U.S. Gulf of Mexico due to Hurricane Francine forced producers to evacuate platforms before it hit the coast of Louisiana. Brent crude futures climbed 0.5% to $72.31 per barrel, while U.S. West Texas Intermediate crude futures rose 0.6% to $69.35 a barrel.
If these gains hold, both benchmarks will break a streak of weekly declines, with Brent set for a 1.7% weekly increase and WTI poised to gain over 2%. Oil producers are assessing damages and conducting safety checks as they prepare to resume operations in the Gulf of Mexico, with estimates of a 50,000 to 60,000 barrels-per-day drop in output for September.
The supply shock has helped oil prices rebound from recent lows, with concerns about demand growth in China and the United States weighing on the market. Both OPEC and the IEA have lowered their demand forecasts, citing economic struggles in China and a shift towards lower-carbon fuels.
China's oil imports have averaged 3.1% lower this year compared to the same period last year, reflecting weakened domestic demand. In the U.S., gasoline and distillate futures hit multi-year lows this week, with oil and fuel stocks rising as demand declined sharply.
Overall, the impact of Hurricane Francine on oil prices highlights the delicate balance between supply disruptions and demand concerns, which could continue to influence market dynamics in the coming weeks.