 Crude steady as storm set to miss production areas
(China Daily)
Updated: 2008-07-23 07:40 Crude oil traded little changed as forecasters said a storm in the Gulf of Mexico will probably miss US oil fields and refineries, easing concern that supplies will be disrupted. Tropical Storm Dolly is predicted to come ashore today near the Texas border with Mexico, south of the Gulf of Mexico area that accounts for about 25 percent of US oil output, the National Hurricane Center said. "We're expecting Dolly to miss the row of refineries that lies in the Gulf of Mexico," said Robert Laughlin, senior broker at MF Global Ltd in London. "Local weather is calm with warm water so there is nothing to suggest that she will change direction." Crude oil for August delivery traded 22 cents higher at $131.26 a barrel at 1:30 pm in London. Earlier yesterday the contract fell as much as 77 cents, or 0.6 percent, to $130.27 a barrel on the New York Mercantile Exchange. Futures are up 74 percent from a year ago. On Monday, oil rose $2.16, or 1.7 percent, to settle at $131.04 a barrel. It was the first increase in five days. Oil settled at $128.88 on July 18, the lowest close since June 5. Prices dropped 11 percent last week, the most in more than three years, on signs of slowing global economic growth and faltering US fuel demand. Dolly's winds Brent crude oil for September settlement was at $132.73 a barrel at 12:02 pm London time on the ICE Futures Europe exchange. On Monday, the contract rose $2.42, or 1.9 percent, to settle at $132.61 a barrel. Prices climbed to a record $147.50 on July 11. Dolly strengthened over the Gulf of Mexico, and may become a hurricane before making landfall near the Texas-Mexico border, the US National Hurricane Center said. Dolly's maximum sustained winds strengthened to 97 kilometers per hour, the agency said in an advisory on its website at about 4:30 am Miami time. The storm was 295 miles southeast of Brownsville, Texas, and moving west at 15 mph, with a turn toward the west-northwest forecast. Exxon Mobil Corp, the world's biggest energy company, said it started evacuating workers from oil and gas wells in the Gulf of Mexico before Dolly arrives. There has been minimal production impact for Exxon, the company said. Agencies (China Daily 07/23/2008 page16) |
