Oil rallies to $73

Oil rose to around $73 a barrel on Friday, supported by growing signs of supply tightness in the United States as a result of Hurricane Ida and as US-China trade hopes gave riskier assets a boost.

About three quarters of the US Gulf’s offshore oil production, or about 1.4 million barrels per day, has remained halted since late August. That amount is roughly equal to what OPEC member Nigeria produces.

“With the restart of offshore crude production lagging, the odds are that the Ida effect will still be felt in the coming weeks,” said Stephen Brennock of oil broker PVM.

Brent crude rose $1.57, or 2.2%, to $73.02 a barrel by 1330 GMT. US West Texas Intermediate (WTI) crude added $1.58, or 2.3%, to $69.72.

Oil and equity markets also got a boost from news of a call between US President Joe Biden and his Chinese counterpart Xi Jinping. The call raised hopes for warmer relations and more global trade, analysts said. 

Published in The Express Tribune, September 11^th, 2021.

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