Hurricane concerns lead to a temporary spike in oil prices

The directionless sideways trading on the oil market continues. Oil prices failed in their attempt to break out of and rise above the sideways corridor yesterday. Brent did not manage to overcome the $50 per barrel mark and dropped back to $48. WTI rose briefly to $47 per barrel but then closed trading at $45 per barrel. Prices are gaining again markedly this morning. Yesterday's price increase was triggered by concerns that Hurricane Joaquin could make landfall in the New York City area. 

A temporary closure of the refinery and port capacities there could have reduced the availability of gasoline and distillates on the US East Coast. According to the latest calculations of the National Hurricane Center in the US, however, the risk of this happening is now lower, with weather experts believing now that landfall is unlikely, says Commerzbank. 

News from the US Energy Information Administration (EIA) that US crude oil production in July climbed unexpectedly by just shy of 100,000 to 9.358 million barrels per day is also weighing on prices. Significantly higher oil production in the Gulf of Mexico was responsible for the surge, as it more than offset the decrease in shale oil production.