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Oil Trades Above $70 As Storm Threat Mounts In Gulf Of Mexico

Oil traded above $70 a barrel Tuesday as Tropical Storm Gordon approached offshore oil fields along the U.S. Gulf Coast.

Futures rose as much as 1.9 percent from Friday, skipping Monday because of the U.S. Labor Day holiday.

Anadarko Petroleum Corp. evacuated two Gulf of Mexico platforms as Gordon neared the mouth of the Mississippi River. The risk of impact pushed up prices despite data showing rising OPEC output.

A hurricane warning has been posted for the Gulf Coast from eastern Louisiana to the Florida-Alabama state line, raising concerns that oil supplies may be disrupted. The region produces about 17 percent of U.S. crude, according to the Energy Information Administration, while onshore plants account for about 45 percent of U.S. refining capacity.

West Texas Intermediate for October delivery rose as much as $1.31 to $71.11 a barrel on the New York Mercantile Exchange, and was at $71.07 as of 10:05 a.m. London time. Monday trades will be booked Tuesday because of the U.S. holiday. Average volume traded Tuesday was more than double the 100-day average.

Brent for November settlement advanced 97 cents to $79.12 a barrel on the ICE Futures Europe exchange, after climbing 51 cents on Monday. The global benchmark crude traded at an $8.47 premium to WTI for the same month.

Source: bloomberg

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