Oil prices drift higher despite storm fears easing
Analysts said traders appeared comfortable with price levels that are relatively high, given the potential for storm-related output losses throughout the summer.
The US government is scheduled to release its weekly petroleum inventory snapshot tomorrow.
Light, sweet crude for August delivery rose 14 cents to settle at $57.46 a barrel on the New York Mercantile Exchange.
Gasoline futures rose 2.62 cents to $1.6735 per gallon on Nymex, where heating oil declined by less than two-tenths of a penny to $1.6301 per gallon.
On London's International Petroleum Exchange, September Brent crude oil futures were trading at $57.10 a barrel, up 11 cents.
Storm forecasters have predicted since the weekend that Emily would not hit US oil rigs in the Gulf of Mexico, calming fears of major supply disruptions in the region that produces 30 percent of US output.
The federal Minerals Management Service said less than 1% of annual production in the region has been shut-in as a result of rig and platform evacuations related to Emily. Hurricane Dennis caused only “extremely light” damage, the agency said, and some five million barrels were shut in over several days.
Traders were hoping that Wednesday’s US petroleum inventories report would suggest how badly the young Atlantic hurricane season had hurt production at offshore rigs.
Kevin Norrish, head of commodities research at Barclays Capital in London, said that while “there still is concern about the shortages, it’s not enough to push prices up significantly from where we are now”.
But, he said, with inventorys set to sink in the coming weeks, “you’re bound to get some volatility”.
Since hitting a peak settlement of $61.28 a barrel earlier this month, oil prices have slid because storm-related output disruptions in the Gulf of Mexico have been minimal and energy demand growth is slower than previously expected.
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