Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Oil prices climb as deep freeze shuts U.S. oil wells, curbs refineries

Published 16/02/2021, 02:08
Updated 16/02/2021, 08:10
© Reuters. FILE PHOTO: The price of gasoline is shown on a gas pump at an Arco gas station in San Diego

© Reuters. FILE PHOTO: The price of gasoline is shown on a gas pump at an Arco gas station in San Diego

By Jessica Jaganathan

SINGAPORE (Reuters) - Oil prices rose on Tuesday as a cold front shut wells and refineries in Texas, the biggest crude producing state in the United States, the world's biggest oil producer.

Prices also gained as Yemen's Iran-aligned Houthi group said it struck airports in Saudi Arabia with drones, raising supply concerns in the world's biggest oil exporter, and on optimism for a global economic recovery amid accelerated COVID-19 vaccine rollouts.

Brent crude was up 14 cents, or 0.2%, at $63.44 a barrel at 0740 GMT, after rising to its highest since January 2020 in the previous session.

U.S. West Texas Intermediate (WTI) crude futures gained 61 cents, or 1%, to $60.08 a barrel. WTI did not settle on Monday because of a U.S. federal holiday. Prices will settle at the close of trading on Tuesday.

"The unexpected U.S. supply disruption provides another short term price recovery bridge that has likely taken oil prices to a level where markets were eventually heading but just a little bit quicker than expected," Stephen Innes, chief global markets strategist at Axi said in a note on Tuesday.

The cold weather in the United States halted Texas oil wells and refineries on Monday and forced restrictions on natural gas and crude pipeline operators.

The rare deep freeze prompted the state's electric power suppliers to impose rotating blackouts, leaving nearly 3 million homes and businesses without power.

Texas produces roughly 4.6 million barrels of oil per day and is home to 31 refineries, the most of any U.S. state, according to Energy Information Administration data, including some of the country's largest.

In the Middle East, Yemen's Iran-aligned Houthi group said on Monday it had struck Saudi Arabia's Abha and Jeddah airports with drones.

The Saudi-led coalition fighting the Houthis in Yemen said early on Monday morning it had intercepted and destroyed an explosive-laden drone fired by the Houthis toward the kingdom.

The World Health Organization (WHO) on Monday listed AstraZeneca (NASDAQ:AZN) and Oxford University's COVID-19 vaccine for emergency use, widening access to the relatively inexpensive shot in the developing world.

© Reuters. FILE PHOTO: FILE PHOTO: Pump Jacks are seen at sunrise near Bakersfield

Capping prices gains, Norway's oil industry employers struck a wage bargain with the Safe labour union on Tuesday, preventing a strike at the Mongstad crude terminal and shutdowns of major offshore oil and gas fields.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.