API Reports Crude Inventory Build As Demand Falters

API Reports Crude Inventory Build As Demand Falters

As of 1656 BST, front month West Texas Intermediate crude oil futures were 0.06% lower to $49.13 a barrel on the NYMEX.

Brent crude LCOc1 increased 16 cents at $54.65 a barrel by 1145 GMT, after earlier hitting its highest level since April at $54.80.

USA energy firms cut oil rigs for a third time in the past four weeks as a 14-month drilling recovery stalled, with energy firms reducing spending plans in response to falling crude prices.

Weaker demand has resulted in higher crude inventory levels in the USA, with concerns about excess supply weighing on prices over the past two weeks.

WTI, the USA standard, declined as demand for oil from refineries has been slow to return to normal levels in the wake of Harvey (http://www.marketwatch.com/story/hurricane-harvey-could-cost-190-billion-be-worst-ever-us-natural-disaster-says-accuweather-2017-08-31).

Hurricane Harvey hit the U.S. Gulf coast two weeks ago, knocking as much as a quarter of the country's huge refinery industry, as a result of which demand for crude oil - refining's lifeblood - fell sharply.

Finally, energy services firm Baker Hughes reported that USA energy firms cut oil rigs for a third time in the past four weeks as the 14-month drilling recovery stalled with energy firms reducing spending plans in response to recent crude price declines. As of late Thursday, data from S&P Global Platts showed that 12.8% of USA refinery capacity was down due to the storm.

Boeing 747 SuperTanker fights California fire for 1st time
The blaze that began Tuesday near the town of Oroville is among a series of wildfires burning across the U.S. The fire Wednesday was burning in dry manzanita, timber and brush northwest of Forbestown, Read said.

U.S. Gulf Coast utilization rates dropped to 63.4 percent, the lowest rates since the EIA began collecting the data in 2010.

"Hurricane Irma is already impacting the natural-gas market with demand out of the southeast region dropping roughly 1.5 [billion cubic feet a day] over the past 24 hours", said Robbie Fraser, commodity analyst at Schneider Electric.

U.S. oil production dropped by nearly 8 percent, from 9.5 million barrels per day to 8.8 million bpd, according to the report of the Energy Information Administration (EIA).

Port and refinery closures along the Gulf coast and harsh sea conditions in the Caribbean have also impacted shipping. Current models show Irma making landfall in Florida by Sunday morning and soaking parts of the area with about a foot of rain.

Another Atlantic storm, named Jose, is following on Irma's heels and has been upgraded to hurricane strength by the U.S. National Hurricane Centre.

"Imports (of oil) to the U.S. Gulf Coast fell to levels not seen since the 1990s", ANZ bank reported.

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