The price of crude oil and brent oil rose in Thursday’s markets as weather forecasts Hurricane Delta once again took a turn for the worse
The gains followed a sell off in the oil as markets reacted to news that the storm would not be as catastrophic as first feared and supply would not be as badly hit as first thought. However, as forecasts for Hurricane Delta showed the storm worsening, investors took advantage of the weaker prices, and immediate supply disruption threats and piled back into oil.
At the time of writing, with weather forecasts worsening still, Crude Oil WTI Futures is up 3.15% trading at $41.32 a barrel, and Brent Oil is up 3.05%, trading at $43.27 a barrel.
Gains Made Despite Libya, Saudi Arabia Production Increase Talk
Investors shrugged off news that two of the world’s largest oil producers are talking about raising production levels. The governor of the Libyan central bank has called for oil production to increase to 1.7 million barrels per day.
“We need to raise the production to 1.7 million barrels per day to cover the country’s spending,” said Sadiq Al-Kabir who started his tenure at the central bank almost nine years to the day, on the 12th October 2011.
Libya joined OPEC – The Organization of the Petroleum Exporting Countries, in 1962. The oil and gas sectors contribute around 60% of the country’s total GDP.
Also raising the possibility of increased production boosting supply levels, was a report in the Wall Street Journal, which said that Saudi Arabia, holder of the second largest oil reserves in the world, is mulling over cancelling OPEC plans for a rise in oil output at the start of next year.
Investors will now be watching events unfurling in Louisiana and the surrounding areas as the Hurricane Delta appears to be worsening.
