Commodity Corner: Irene Supply Fears Propel Oil, Gasoline
Light sweet crude oil gained 14 cents Thursday amid fears that Hurricane Irene could diminish gasoline supplies along the East Coast.
The WTI ended the day at $85.30 a barrel after fluctuating from $83.01 to $86.56. The major hurricane, which is expected to hit North Carolina's Outer Banks Saturday evening, could cause widespread power outages, flooding, and wind damage from the Carolinas to New England. Six refineries with approximately 1.3 million barrels of processing capacity lie within the storm's projected path. Pipelines and terminals serving those facilities could also be impaired should Irene remain on her current track.
As of 5 p.m. EDT Thursday, Hurricane Irene was packing maximum sustained winds of 115 miles per hour. The storm, centered over the Bahamas at press time, was moving north-northwestward at 14 mph.
The Brent contract price also settled higher Thursday, gaining 47 cents to end the day at $110.62 a barrel. It peaked at $111.38 and bottomed out at $109.05.
Buoyed by the threat of Irene, gasoline for September delivery rose nine cents to end the day at $2.97 a gallon. It traded within a range from $2.88 to 2.97.
September natural gas edged upward by one cent to settle at $3.93 per thousand cubic feet. The front-month contract fluctuated from $3.87 to $3.98.