|
TOKYO, Oct 3 (Reuters): Oil prices were steady today as slow recovery in production and refining disrupted by hurricanes in the Gulf of Mexico ahead of winter was balanced by slower gasoline demand.
US crude oil was up 4 cents to $66.28 a barrel in Asian trade. London Brent crude gained 15 cents to $63.63 a barrel. A dozen refineries accounting for about 18 percent of US refining capacity remained shut as of Friday after hurricanes Rita and Katrina. The shutdown equals to a daily loss of more than 1.3 million barrels of gasoline production, the Energy Information Agency (EIA) said.
The latest US government figures showed the gasoline stock level was 199.8 million barrels in the week to Sept. 23, down 5.9 million barrels from a year earlier. But demand for the auto fuel over the past four weeks has averaged almost 3 percent below the year-ago period, government data showed.
Crude oil output from the Gulf of Mexico, nearly completely paralysed after the storms, may also be slow to return due to extensive damage to rigs and undersea pipelines.
As of Friday, 98 per cent of crude production and 79 per cent of natural gas output was shut in the Gulf of Mexico, home to more than a quarter of US domestic production.
High oil prices, which struck record-highs of $70.85 a barrel in late August, are beginning to hit business and consumer confidence.
A Bank of Japan survey showed Monday that Japanese business confidence gained slightly in the latest quarter but was weaker than expected as rising energy costs dampened sentiment.
A US government report last week showed that consumer spending fell a surprisingly steep 0.5 per cent in August, the biggest drop since November 2001. This came as energy prices pushed US consumer inflation up 0.5 per cent, the biggest jump since September 1990.
Traders were also watching tensions in OPEC exporter Iran, after the UN's nuclear watchdog has recommended Tehran be reported to the Security Council for possible sanctions.
Supplies from France, a major supplier of oil products to European and US markets, could be affected by ongoing strikes.
Port workers in southern France have extended until Monday a strike that has blocked access to the Lavera and Fos petrochemicals and 570,000 barrel-per-day (bpd) oil refining hub.
Royal Dutch Shell said on Friday its 80,000-bpd refinery in the region could cut runs if the strike continued beyond the weekend. A strike that has shut down oil major Total's biggest refinery in northern France has also been extended to Monday.
|