Oil Falls in Anticipation of a Limited Impact From Hurricane Laura

Oil prices fell on Thursday (August 27th) as the market expects a rapid recovery of production platforms that were shut down by a hurricane across the Gulf of Mexico and the US state of Louisiana.

Brent crude futures for October delivery, which expire on Friday, fell 55 cents, or 1.2%, to settle the settlement price at $ 45.09 a barrel. US West Texas Intermediate crude futures fell 35 cents, or 0.8%, to $ 43.04 a barrel.

Hurricane Laura struck Louisiana early today, with winds of 240 kilometers per hour, damaging buildings and cutting off electricity to more than 400,000 people in Louisiana and Texas.

On Tuesday, oil producers stopped 1.56 million barrels per day of crude production, or 84% of the Gulf of Mexico’s production, and evacuated 310 offshore facilities.

BP said today that it is already preparing to return to its facilities in the deep waters of the Gulf of Mexico to detect any possible damage from the storm.

Meanwhile, operations were halted by refining companies that process about 2.33 million barrels per day of crude oil, or about 12% of US refining capacity.