Oil prices up again as storm heads for US
Crude oil prices were back near $67 a barrel today after jumping 7% amid fears about the impact of a new storm bearing down on the United States.
Last night’s rise of more than four US dollars a barrel came as Opec ministers continued to discuss ways in which they could draw the sting from the market.
Weather reports showing Tropical Storm Rita gathering strength close to the Bahamas led to parallels being drawn with Hurricane Katrina, which wreaked havoc in the Gulf of Mexico last month.
Forecasters are warning that Rita is on a projected course that could see it land on the Texas Coast – near to major oil facilities in the region.
The market followed last night’s sharp rise in New York by keeping the price of oil at around $67 a barrel in Asian trading today, still short of the $70.85 seen when Hurricane Katrina made landfall.
Oil prices have eased in recent days, contributing to the decision of some petrol retailers in the UK to cut forecourt prices.
But with more than half of oil production still blocked in the Gulf of Mexico and US refining capacity short of pre-storm levels, any further storm damage could leave the industry overstretched.
Katrina sparked panic buying at filling stations as motorists filled their tanks in case fuel supplies ran out, but nationwide protests against rising prices failed to materialise on a scale to match the disruption of 2000.
In Vienna, oil cartel Opec again sought to reassure markets there was enough crude oil, but backed away from an immediate boost in output. It will decide on its long-term position today, but traders said any Opec move was merely symbolic.
Opec president Sheik Ahmed Fahd Al Ahmed Al Sabah said support was building for the proposal to make available two million extra barrels of oil a day to counter supply fears and stabilise prices.
