HOUSTON: Oil prices rose by more than USD1 a barrel on Tuesday as producers reeled from a winter storm that hobbled crude production and drove US Gulf Coast crude exports to zero over the weekend.
Brent crude futures were up USD1.29 or 1.97 percent, at USD66.88 a barrel by 11:31 a.m. EDT (1631 GMT). US West Texas Intermediate crude was up USD1.29 or 2.13 percent, at USD61.92 a barrel.
US oil producers lost up to 2 million barrels per day or roughly 15 percent of national production over the weekend, analysts and traders estimated, as a severe winter storm swept across the country, straining energy infrastructure and power grids.
Severe weather has boosted crude futures, with short-term risks tilted to the upside on fears of supply disruptions, said Fawad Razaqzada, market analyst at City Index.
“The cold weather in the US will likely cause quite significant drawdowns in oil stocks over the next few weeks, particularly if this weather persists,” said Tamas Varga, an oil analyst at brokerage PVM.
Exports of crude oil and liquefied natural gas from US Gulf Coast ports tumbled to zero on Sunday amid frigid weather, ship tracking service Vortexa said.
Exports rebounded on Monday with flows coming in above seasonal norms as ports reopened, said Samantha Santa Maria-Hartke, head of market analysis at Vortexa.
Elsewhere, Kazakhstan’s biggest oilfield, Tengiz, is likely to restore less than half of its normal production by February 7 as it slowly recovers from a fire and power outage, two sources familiar with the matter told Reuters.
“The recovery of Tengiz production seems to be happening slower than earlier expected, keeping the oil market tighter,” said Giovanni Staunovo, an analyst at UBS, adding that the weaker US dollar was lending some support.
However, the CPC, which operates Kazakhstan’s main exporting pipeline, said it returned to full loading capacity at its terminal on the Russian Black Sea coast after maintenance was completed at one of its three mooring points.
US aircraft carrier and supporting warships have arrived in the Middle East, two US officials told Reuters on Monday, expanding President Donald Trump’s capabilities to defend US forces, or potentially take military action against Iran.
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