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Gasoline soars, oil struggles as Harvey impact weighed

Published 08/31/2017, 03:36 AM
© Reuters.  Gasoline soars, oil struggles with Harvey impact in focus
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Investing.com - Gasoline futures soared to their highest level since July 2015 on Thursday, while oil prices struggled near a five-week trough, as energy markets continued to weigh what the impact of Harvey will be on supply and demand.

Gasoline futures for October climbed 2.7 cents, or roughly 1.7%, to $1.669 a gallon by 3:35AM ET (0735GMT).

Spot prices hit $2.00 for the first time since 2015, as flooding from storm Harvey knocked out almost a quarter of U.S. refineries, prompting fears of a supply squeeze.

Elsewhere on Nymex, the U.S. West Texas Intermediate crude October contract was at $45.97 a barrel, little changed on the day. It ended 1% lower on Wednesday after hitting its weakest level since July 24 at $45.58.

Meanwhile, Brent oil for November delivery on the ICE Futures Exchange in London slipped 4 cents to $50.69 a barrel, after sliding 1.8% a day earlier.

Oil futures settled lower on Wednesday amid worries of reduced demand from refineries.

Harvey has battered the U.S. Gulf coast since last Friday, ripping through Texas and Louisiana at the heart of the U.S. petroleum industry.

Texas is home to 5.6 million barrels of refining capacity per day, and Louisiana has 3.3 million barrels. Over 2 million barrels per day (bpd) of refining capacity were estimated to be offline as a result of the storm.

Beyond Harvey, U.S. commercial crude oil stocks fell by 5.4 million barrels last week, according to data released Wednesday by the U.S. Energy Information Administration, marking the ninth straight weekly decline.

However, the data was collected before Hurricane Harvey hit the Gulf Coast.

Elsewhere, natural gas futures for October delivery held steady at $2.942 per million British thermal units, as traders looked ahead to weekly storage data due later in the global day.

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