Oil prices were mixed on Tuesday as traders weighed enormous output cuts in the U.S. Gulf Coast from Tropical Storms Marco and Laura against surging coronavirus cases in Asia and Europe.
“A jump last week in the U.S. rig count and mixed data on COVID-19 infections are having a muted negative effect on oil this week, thanks in part to the possible disruption from two separate hurricanes moving into the U.S. Gulf Coast region,” said Stephen Innes, Chief Global Markets Strategist at AxiCorp.
Energy firms moved to reduce production at U.S. Gulf Coast oil refineries on Monday after shutting 82% of the area’s offshore crude oil output as the rare double-storm assault on major U.S. oil regions threatens to bring days of heavy rains and strong winds this week.
Producers have shut over 1.5 million barrels per day of Gulf Coast offshore oil production, roughly 14% of U.S. total output.
On Monday, a top U.S. infectious diseases expert warned that rushing out vaccines could undermine trials of other potential candidates, following a boost to markets after U.S. regulators approved the use of blood plasma from recovered COVID-19 patients as a treatment option.
Europe is similarly witnessing a surge in COVID-19 infections while the first documented case of human re-infection with coronavirus was recorded with a man in Hong Kong catching the virus again some four months after first being infected.
Meanwhile, U.S. crude oil inventories likely fell for the fifth week in a row, while refined product stockpiles also declined last week, a preliminary Reuters showed on Monday.
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