World oil prices rose by less than one dollar in Asian trade on Monday after Hurricane Gustav forced the shutdown of almost all oil production in the Gulf of Mexico, analysts said.
New York’s main contract, light sweet crude for delivery in October, rose 84 cents to USD 116.30 a barrel from its close of USD 115.46 when trading closed Friday at the New York Mercantile Exchange.
Brent North Sea crude for October gained 72 cents to USD 114.77 from USD 114.05 in London on Friday.
About one quarter of US oil production comes from the Gulf, one of the largest energy production hubs in the Americas, but US officials said on Sunday that more than 96 per cent of Gulf oil production and 82 per cent of natural gas output had been stopped in the face of the storm.
Gustav was on target to plough into coastal Louisiana on Monday, potentially as a Category 4 storm with sustained winds of 242 kilometres per hour and storm surges up to 4.8 metres above normal.
“It’s all about Gustav,” said Tony Nunan, of Mitsubishi Corp’s international petroleum business in Tokyo.
But he said price gains had been limited because of underlying worries about a global economic slowdown and falling demand for oil.
World oil prices have sunk from record highs above USD 147 a barrel in early July after surging from USD 100 at the start of the year.
Today’s rise of about one dollar was “not really that much”, Nunan said, adding that trading would be thin because the US markets were shut for the Labour Day holiday.
