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Brent crude futures for November rose $1.24, or 1.8%, to $71.85
a barrel by 1008 GMT. U.S. crude futures for October were up
$1.26, or 1.9%, at $68.57.
Both contracts rose by more than 2% in the previous session as
offshore platforms in the U.S. Gulf of Mexico were shut and
refinery operations on the coast were disrupted by Hurricane
Francine's landfall in southern Louisiana on Wednesday.
"Hurricane Francine has likely disrupted about 1.5 million
barrels of U.S. oil production, which we estimate will reduce
September production in the Gulf of Mexico by around 50,000
barrels per day (bpd)," UBS analysts said.
Nearly 39% of oil and almost half of natural gas production in
the Gulf of Mexico was offline on Wednesday, the offshore
regulator said. A total of 171 production platforms and three
rigs had been evacuated.
"The region accounts for about 15% of U.S. oil production, with
any disruptions in production likely to tighten supplies in the
near term," said Priyanka Sachdeva, senior market analyst at
Singapore-based brokerage Phillip Nova.
But with the storm set to dissipate after landfall, oil market
attention began to turn to lower demand.
On Thursday the International Energy Agency (IEA) cut its 2024
oil demand growth forecast by 70,000 bpd, or about 7.2%, to
900,000 bpd, citing muted Chinese demand.
U.S. oil stockpiles rose across the board last week as crude
imports grew and exports dipped, the Energy Information
Administration (EIA) said on Wednesday.
Despite worries over Hurricane Francine, the medium-term trend
remains bearish for WTI crude, supported by weak demand from
China and "growth scare concerns" in the U.S., said Kelvin Wong,
senior market analyst at OANDA.
Earlier in the week, the Organization of the Petroleum Exporting
Countries (OPEC) cut its forecast for global oil demand growth
this year and trimmed its expectation for 2025, its second
consecutive downward revision.
Both oil benchmarks tanked on Tuesday after the downward
revision.
Meanwhile, investors are awaiting the U.S. Federal Reserve's
policy meeting over Sept. 17-18 with expectations of a cut to
interest rates.
Lower interest rates could stimulate economic growth and
increase demand for oil.
Traders are also awaiting U.S. economic data expected later on
Thursday.
(Reporting by Arunima Kumar in Bengaluru, Katya Golubkova in
Tokyo and Emily Chow and Jeslyn Lerh in SingaporeEditing by
David Goodman)
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