Author: Colleen Howe and Trixie Yip
(Reuters) – Oil prices were little changed on Tuesday after a hurricane that hit Texas, the main U.S. oil production hub, caused less damage than markets expected, easing concerns about supply disruptions.
Futures were up 4 cents at $85.79 a barrel by 0622 GMT, while U.S. West Texas Intermediate (WTI) crude was up 2 cents at $82.35 a barrel.
Although refinery activity slowed and some production sites were evacuated, major U.S. Gulf Coast refineries appeared to be least affected by Hurricane Beryl, which weakened into a tropical storm after hitting the Texas coast.
“Early indications are that most energy infrastructure remains unscathed,” ING analysts Warren Patterson and Ewa Manthey said in a client note, adding that price movements in crude oil and refined fuel markets were not reflecting concerns about the hurricane. Supply disruption concerns.
That eased concerns about the risk of supply disruptions in Texas, which produces 40% of the oil.
Major oil shipping ports around Corpus Christi, Galveston and Houston were closed ahead of the storm. The Corpus Christi Ship Channel reopened Monday and the Port of Houston was expected to resume operations Tuesday afternoon.
Several major refiners, including Marathon Petroleum Corp. (NYSE: ), are also preparing to restart their refineries. [REF/OUT]
Market participants are also paying close attention to the situation in the Middle East for more trading clues. Oil prices fell 1% on Monday as a potential ceasefire in Gaza could reduce concerns about disruptions to global crude supplies.
The White House said senior U.S. officials were meeting in Egypt on Monday, but differences remained between the two sides, with Hamas saying a new Israeli push into Gaza threatened a potential deal.
The market is also awaiting the release of key U.S. inflation data. Federal Reserve Chairman Powell will appear before Congress on Tuesday and Wednesday. Investors are betting that a series of weak labor market data will greatly increase the possibility of a September interest rate cut to about 80%.
“With recent U.S. economic data picking up and bets on a rate cut in September increasing, any validation of upcoming inflationary progress could help support the broader risk environment, which could set the stage for oil prices to rebound on more favorable demand.” Stability provides some space under the foreground.
A sharp increase in Saudi Arabian crude oil on contract by Asian buyers also provided support to the market, with exports to China rising in August for the first time in four months.
