Output Still Halted by Hurricane Recovery & Rising COVID Cases

Today prices have been fairly steady, with crude oil opening the day at $69.36, up slightly from yesterday’s closing price of $69.30. Diesel and gasoline followed similar trends with diesel opening the day at $2.1350 and gasoline at $2.1388. These prices come as crude oil output remains offline following Hurricane Ida, accompanied by a demand forecast that is considering the rising cases in COVID-19 around the country.

Around 77% of the US Gulf oil production has been stopped due to the effects of Hurricane Ida, and a resumption of operations is still lingering. This outage has caused a loss of around 1.4 million barrels per day (bpd) to the market. An astounding 17.5 million barrels of oil have been lost in total since the start of the hurricane. According to the Bureau of Safety and Environmental Enforcement (BSEE), “More than 70 platforms of the 288 evacuated ahead of the August storm remain unoccupied.” With power still out for over 325,000 people and five major refineries, the struggle to bring in more crews and equipment to address power outages and flooding is proving to be a big task for recovery groups.

According to the Biden administration, President Biden has a new “robust plan to stop the spread of delta variant and boost COVID-19 vaccinations.” This call to action comes as the pressure is ramping up on the president and public health continues to worsen, with average deaths from the virus in a seven-day period totaling 1,524 compared to 509 a month ago. Along with his new plan, Biden is hoping to call a global summit to be held during the United Nations General Assembly later in September, with the main topics being COVID-19 response and vaccine supply.