Daily Times

OPEC kept its modest global oil demand growth forecast at 1.14 million bpd for 2020, suggesting that the world would need 29.27 million bpd of crude from its 14 members in 2020, down 1.34 million bpd this year. After holding stable below $65 and $60 for nearly two months respectively, Brent crude’s price jumped to $66.72 and WTI’s to $60.21 per barrel. Oil prices are higher over sharpening US crude inventories and concerns over US Gulf of Mexico production ahead of Tropical Storm Barry, as well as tensions in the Arabian Gulf after Iran’s alleged attempt to block a British-owned tanker in the Strait of Hormuz. The Atlantic hurricane season threatened offshore oil production and began soaking Louisiana with heavy rains, leading to 15 production platforms and four rigs being evacuated in the Gulf of Mexico. So far, oil companies operating in the area have halted about 1 million barrels per day (bpd) of offshore oil output, or 53 percent of the region’s total production. The Gulf of Mexico and the Texas coast produce about 5 percent of US natural gas and 17 percent of crude oil. Onshore facilities account for about 45 percent of US refining capacity and 51 percent of its gas processing. The Louisiana Offshore Oil Port will be closely monitoring Atlantic storm activity. The weather has added to the headaches caused by the increasing demand for refined products while US inventories continued to recede more than expected for the fourth consecutive week. As US oil producers in the gulf cut more than half their output, commercial crude stocks fell 9.5 million barrels to 459 million barrels, a 12-week low.