Oil Prices Surge as Gulf Coast Storm Approaches and Markets Recover

Oil prices jumped by over 1onMonday,drivenbyapotentialhurricanesystemapproachingtheUSGulfCoastandarecoveryfromlastweek′sselloff.WestTexasIntermediate(WTI)crudefuturesrose1.48$\mathrm{1onMonday,drivenbyapotentialhurricanesystemapproachingtheUSGulfCoastandarecoveryfromlastwee<mi>k\prime </mi>sselloff.WestTexasIntermediate}(\mathrm{WTI})\mathrm{crudefuturesrose1.48}$68.67 a barrel, while Brent crude futures gained 1.39% to $72.05 a barrel.

The price bounce was attributed to concerns about the potential hurricane’s impact on US Gulf Coast refining capacity, which accounts for approximately 60% of the country’s refining capacity. Additionally, markets were recovering from a selloff following weaker-than-expected US jobs data on Friday.

However, weak demand continues to cap price gains, with refining margins in Asia slipping to their lowest seasonal levels since 2020. Fuel oil exports to the US Gulf Coast also fell to their lowest level since January 2019 last month due to weaker refining margins.

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