Global oil prices ended mixed on Friday at the end of a record-breaking week with tensions still high over tight supplies and Gulf of Mexico storms.
New York's main futures contract, light sweet crude for delivery in November, eased US$0.16 to close at US$81.62 per barrel.
In London, the price of Brent North Sea crude for November delivery rose US$0.21 to settle at US$79.30 per barrel, after hitting an all-time high of US$79.94 per barrel.
Traders are worried that stormy weather in the Gulf of Mexico, which accounts for about one quarter of US oil output, could disrupt production and stretch tight global supplies ahead of peak US winter demand for heating fuel.
The New York October contract on Thursday rocketed to a record US$84.10 per barrel before its expiry, while Brent surged past its previous peak set in August last year.
Prices are setting fresh records owing to the "evacuation of oil rigs and platforms" in the Gulf of Mexico, Barclays Capital analyst Kevin Norrish said.
"The concern is that what is currently only a tropical disturbance in the eastern Gulf could develop into a tropical storm and companies have already started evacuating workers from the area," he said.
Sucden analyst Michael Davies said that "crude futures remain well supported by a number of fundamental factors."
"The most recent support came from news that over 360,100 barrels of daily oil output was closed in the Gulf of Mexico, as energy producers were shutting down production facilities, because of a tropical storm developing in the region," he said.
Crude futures have enjoyed a record-breaking week in New York and London as traders have seized on supply worries ahead of the forthcoming northern hemisphere winter season.
Prices have also drawn strength from the diving US currency, which makes dollar-denominated commodities such as oil cheaper for foreign buyers using other currencies.
The US Federal Reserve's decision Tuesday to cut key interest rates by a bigger-than-expected 50 basis points to 4.75 percent has also perked up the oil market, which expects the cut to spur demand in the world's biggest energy consumer.
"Everybody is worried about the [US] inventory level going into the fourth quarter," said Tony Nunan, energy risk manager at Mitsubishi Corp in Tokyo.
The US Department of Energy had said Wednesday that American crude inventories plunged by 3.8 million barrels in the week ending September 14, underscoring global supply tightness.
That marked the 10th consecutive weekly drop and was almost double analysts' consensus forecasts for a fall of about 2 million barrels.
Mike Fitzpatrick at MF Global said there is a possibility of a further correction in prices after the sharp gains.
"I think the prices will come down to about US$74 to US$76," he said. "We suspect that a sharp correction is imminent."
TARIFFS: The global ‘panic atmosphere remains strong,’ and foreign investors have continued to sell their holdings since the start of the year, the Ministry of Finance said The government yesterday authorized the activation of its NT$500 billion (US$15.15 billion) National Stabilization Fund (NSF) to prop up the local stock market after two days of sharp falls in reaction to US President Donald Trump’s new import tariffs. The Ministry of Finance said in a statement after the market close that the steering committee of the fund had been given the go-ahead to intervene in the market to bolster Taiwanese shares in a time of crisis. The fund has been authorized to use its assets “to carry out market stabilization tasks as appropriate to maintain the stability of Taiwan’s
STEEP DECLINE: Yesterday’s drop was the third-steepest in its history, the steepest being Monday’s drop in the wake of the tariff announcement on Wednesday last week Taiwanese stocks continued their heavy sell-off yesterday, as concerns over US tariffs and unwinding of leveraged bets weighed on the market. The benchmark TAIEX plunged 1,068.19 points, or 5.79 percent, to 17,391.76, notching the biggest drop among Asian peers as it hit a 15-month low. The decline came even after the government on late Tuesday authorized the NT$500 billion (US$15.2 billion) National Stabilization Fund (國安基金) to step in to buoy the market amid investors’ worries over tariffs imposed by US President Donald Trump. Yesterday’s decline was the third-steepest in its history, trailing only the declines of 2,065.87 points on Monday and
TARIFF CONCERNS: The chipmaker cited global uncertainty from US tariffs and a weakening economic outlook, but said its Singapore expansion remains on track Vanguard International Semiconductor Corp (世界先進), a foundry service provider specializing in producing power management and display driver chips, yesterday withdrew its full-year revenue projection of moderate growth for this year, as escalating US tariff tensions raised uncertainty and concern about a potential economic recession. The Hsinchu-based chipmaker in February said revenues this year would grow mildly from last year based on improving supply chain inventory levels and market demand. At the time, it also anticipated gradual quarter revenue growth. However, the US’ sweeping tariff policy has upended the industry’s supply chains and weakened economic prospects for the world economy, it said. “Now
An employment discrimination lawsuit against contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) might soon be expanded after a hearing in a federal court in San Jose, California, on Tuesday to add 15 plaintiffs to the case. According to a court document, the lawsuit, which was refiled in November last year as a form of a class action with 13 plaintiffs in California, wants to add 15 plaintiffs from Arizona, where TSMC is building up its wafer fab capacity. TSMC first committed between 2020 and last year to invest US$65 billion in three advanced wafer fabs in Arizona. It then pledged an
RSS