Brent Rises on US Production Cuts and Hopes of a Trade Deal With China

Brent crude prices rose on Wednesday, August 26th, supported by US producers halting most of the offshore production from the Gulf of Mexico before Hurricane Laura and optimism about Sino-US trade talks.

Gains were limited by renewed fears about the Coronavirus pandemic, which reduced demand for fuel after reports of recovered people in Europe and Asia infected with Covid-19 again, which raised fears about immunity in the future.

Brent futures added ten cents, or 0.2%, to $ 45.96 a barrel by 06:42 GMT, while US West Texas Intermediate crude lost five cents, equivalent to 0.1%, to $ 43.30 a barrel. And the two crude closed on Tuesday at the highest level in five months.

Yesterday, Tuesday, the energy sector in the United States prepared for a strong hurricane and producers evacuated 310 offshore facilities and halted production of 1.56 million barrels per day of crude, which represents 84% ​​of marine production in the Gulf of Mexico, close to the stoppage caused by Hurricane Katrina 15 years ago and reached 90%.

Prices also received more support from the American Petroleum Institute data, which showed that US crude inventories fell more than expected in the past week. The Energy Information Administration, the statistical sector of the Ministry of Energy, will release official inventory data on Wednesday.

But the downward pressure continued due to concerns about demand after data showed that US consumer confidence fell to its lowest level in more than six years due to fears of job losses due to Coronavirus.