Crude Oil Prices Settle Higher Ahead of Storm Gordon

Investing.com – WTI crude oil prices settled marginally higher Tuesday amid expectations for supply disruptions as a Hurricane is expected to make landfall on the U.S. Gulf coast, but gains were limited by a report of rising supplies at Cushing, Oklahoma.

On the New York Mercantile Exchange, for October delivery rose 7 cents to settle at $69.87 a barrel, while on London’s Intercontinental Exchange, fell 0.44% to trade at $77.81 a barrel.

Oil prices made a bright start to the session after reports that two Gulf of Mexico oil producers took precautionary measures ahead of the arrival of Tropical Storm Gordon. The storm is expected to become a hurricane before it makes landfall as a Category 1 hurricane near the Mississippi-Alabama border.

The storm threatens oil production and refinery activity in the oil-rich Gulf area, which makes up about one-sixth of U.S. oil production and 45% of its refining capacity.

The initial surge in oil prices, however, came under pressure after a report of supplies at a domestic delivery hub at Cushing, Oklahoma.

Information provider Genscape reportedly said U.S. crude inventories at Cushing had risen in the week, according to traders. Stockpiles at the hub rose by 0.754 million barrels from Aug. 24 to Friday.

The prospect of rising domestic supplies comes against a backdrop of fears that global supplies are set to come pressure amid signs that Iran’s oil exports are facing pressure ahead of U.S. sanctions slated for early November.

President Donald Trump pulled the United States out of the Iran nuclear agreement in May, allowing sanctions against Iran to snap back into place. The first wave of sanctions went into effect last month and a second set of sanctions on Iran’s crude exports are slated for early November.

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