Commodities: Crude oil futures dip as Barry exits Gulf of Mexico

Jeannie Matthews
July 18, 2019

USA crude CLc1 settled at $59.58 a barrel, shedding 63 cents, or 1.1%.

Uncertainty about China's economic prospects also pressured prices lower after data on Monday showed that growth in the country slowed to 6.2% from a year earlier, the weakest pace in at least 27 years.

Brent crude futures dropped 29 cents, to $66.43 a barrel, while U.S. West Texas Intermediate crude dropped 63 cents, or 1.1%, to $59.58/Bbl.

There was 1.three million barrels per day (bpd) of oil manufacturing off line within the U.S. -regulated areas of the Gulf of Mexico on Monday, about 80,000 barrels lower than on Sunday, in keeping with the U.S. Bureau of Security and Environmental Enforcement (BSEE).

U.S. oil firms on Monday started restoring a number of the greater than practically 74% manufacturing shut at U.S. Gulf of Mexico platforms forward of Hurricane Barry, the U.S. offshore drilling regulator stated.

Prices continued to be buoyant on the back of falling United States oil inventories.

First-half crude output rose 0.8 per cent from a year ago to 95.39 million tonnes.

The NBS data also showed that China's crude oil output last month climbed 1 per cent from a year earlier to 16.1 million tonnes, or about 3.92 million bpd, up from May's 3.82 million bpd.

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No serious injuries or major damage were reported as Barry reached the state of Louisiana Saturday as a Category 1 hurricane . The Louisiana coastal community of Isle de Jean Charles has already lost 98% of its land - and that was before Barry hit.

Workers were returning to the more than 280 production platforms that had been evacuated.

One U.S. Gulf Coast refinery was restarting after shutting under threats of Tropical Storm Barry, while other refineries in the path of the storm continued to operate.

"A stronger dollar, along with the return of Gulf of Mexico oil production following Hurricane Barry's passage have capped prices so far today", Action Economics said in a note.

Gasoline stocks USOILG=ECI rose 3.6 million barrels, compared with analysts' expectations in a Reuters poll for a 925,000-barrel drop.

The outages caused by the storm are expected to affect the next tally of US stockpiles, and analysts in a Bloomberg survey predict a 3 million barrel drop in inventories last week - a fifth straight decline - when the government releases the data on Wednesday.

USA officials say they are unsure whether an oil tanker towed into Iranian waters was seized by Iran or rescued after facing mechanical faults as Tehran asserts, sowing confusion at a time of high tension in the Gulf.

Distillate stockpiles USOILD=ECI grew by 5.7 million barrels, much more than expectations for a 613,000-barrel increase, the EIA data showed.

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