By Gina Lee
Investing.com – Oil was up Friday morning in Asia, and is set to end the week on a high note. Energy companies began shutting down production in the Gulf of Mexico ahead of a potential hurricane forecast to hit on the weekend, increasing concerns about the near-term supply disruption.
gained 0.60% to $70.60 by 11:27 PM ET (3:27 AM GMT), remaining above the $70 mark. rose 0.95% to $68.06, climbing back up from a 1.4% loss on Thursday.
Companies started evacuating their workers from Gulf of Mexico oil production platforms on Thursday, with BHP and BP (NYSE:) halting production at their offshore platforms ahead of the hurricane.
The possibility of supply disruptions in the region, which accounts for 17% of U.S. crude oil production and 5% of dry production, helped the black liquid claw back from Thursday’s losses. These losses were partly due to output returning at a Petróleos Mexicanos offshore oil platform following a fire earlier in the week.
“The market may have more immediate concerns, with a storm building in the Caribbean. It’s expected to become a powerful hurricane and potentially wreak havoc in the Gulf of Mexico and Texas early next week,” ANZ Research analysts said in a note.
Investors are also monitoring the dollar’s moves on Friday, with U.S. Federal Reserve Chairman Jerome Powell due to give a speech later in the day that could potentially reveal a timeline for asset tapering and interest rate hikes.
“If we do see an earlier asset tapering, our expectation is the U.S. dollar will lift, and that will put pressure on oil and other commodities,” Commonwealth Bank commodities analyst Vivek Dhar told Reuters.
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