Oil rises above $43 on supply losses, U.S. stimulus hopes
By Laura Sanicola
NEW YORK (Reuters) - Oil rose slightly on Thursday, supporting a session high of more than $ 43 a barrel, due to production shutdowns ahead of a storm in the US Gulf of Mexico and the prospect of further supply losses in Norway.
Oil and gas workers have withdrawn from offshore production facilities in the U.S. Gulf as the Hurricane Delta is expected to exacerbate into a major Category 3 storm. Almost 1.5 million barrels of daily production were stopped.
Brent crude oil rose 86 cents, or 2%, to 42.85 barrels at 11:15 am EDT (1515 GMT) after falling 1.6% on Wednesday. U.S. West Texas Intermediate (WTI) crude oil rose 78 cents, or 2%, to $ 40.73 after falling 1.8% on Wednesday.
"Hurricane Delta is a crude oil supply event and if all Gulf of Mexico production goes offline we will likely lose more than 5 million barrels of crude oil to the storm," said Andrew Lipow, president of Lipow Oil Associates in Houston, Texas.
"However, the storm has had limited impact on demand for gasoline and diesel," he added.
Oil was also helped by the prospect of further production stoppages in the North Sea due to a workers' strike. Johan Sverdrup's peloton must be closed unless the strike ends on October 14th.
The production losses offset concerns about demand, rising coronavirus cases, and rising US crude oil inventories.
Renewed optimism about some US coronavirus remedies also supported the market.
After President Donald Trump halted talks on a major US economic agreement, he wrote on Twitter that Congress should pass funding for airlines, small businesses, and economic reviews for individuals to raise hopes for relief.
The organization of the petroleum exporting countries faces a new challenge as production increases in Libya, an OPEC member exempt from production cuts.
On Thursday, OPEC General Secretary Mohammad Barkindo said the worst for the oil market was over.
(Additional reporting by Alex Lawler. Sonali Paul, Shu Zhang and Ahmad Ghaddar; editing by David Gregorio, Jason Neely and Mark Potter)
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