NYMEX Oil Futures Mixed Friday Morning

NEW YORK (DTN) -- New York Mercantile Exchange spot-month oil futures were mixed Friday morning, with the market still mulling the potential impacts of Hurricanes Irma and Katia that are coming on the heels of Hurricane Harvey that devastated the Texas Gulf Coast nearly two weeks ago.

While the October West Texas Intermediate crude oil and RBOB futures contracts steadied at last view, NYMEX ULSD futures and Brent crude oil futures on the IntercontinentalExchange extended gains during overnight trade. ULSD futures posted a 26-month spot high of $1.7983 gallon, while Brent rallied to a $54.87 bbl 4-1/2 month high.

Except for NYMEX RBOB futures, the rest of oil futures contracts are thus far set to post weekly gains as refiners ramp up crude processing after disruptions from Harvey. Brent's advance was based primarily on strong demand from Europe and Asia, as well as reports that Saudi Arabia will cut crude exports to its customers worldwide in October by 350,000 barrels per day (bpd), said analysts.

Hurricane Harvey's shutdown of ports and refineries on the Texas coast when it made landfall on Aug. 25 limited U.S. exports of crude oil and products to overseas markets, prompting consumers in Europe to scramble for Brent and gas oil from alternative sources, said analysts.

Harvey's impact was also felt in petroleum production. U.S. oil output fell by 7.9%, from 9.53 million bpd to 8.781 million bpd and refinery runs plunged by 16.9% to 79.7% during the week-ended Sept. 1, according the Energy Information Administration's most recent weekly oil report issued on Thursday.

Traders and analysts are not only waiting for this week's rig count due later this afternoon from Houston-based Baker Hughes Inc., but also watching the paths of Hurricanes Irma and Katia to determine if the storms would affect U.S. oil and gas production in the Gulf of Mexico in the coming days.

After pummeling Puerto Rico and the U.S. Virgin Island, shutting down an oil terminal there on Thursday, Irma barreled through the Dominican Republic and Haiti overnight, and its core is forecast to move between the Bahamas and Cuba today, the National Hurricane Center said.

The most powerful Atlantic hurricane ever recorded is now predicted to reach south Florida by Saturday night as a Category 4 hurricane.

Irma has prompting fuel shortages across the Sunshine state as thousands of drivers rush to fill their gas tanks in advance of the storm. Hurricane Jose is closely following Irma, and has maintained strength over the Atlantic Ocean, NHC said in its latest advisory.

Hurricane Katia has formed in the Gulf of Mexico, the location of most U.S. offshore oil and gas production. The Air Force is set to conduct further investigations on the storm, said NHC.

At 9 a.m. EDT, NYMEX October WTI crude futures was little changed, down 2 cents at $49.07 per barrel. November Brent crude on the ICE platform advanced by 30 cents to $54.79 bbl, off a 4-1/2 month spot high of $54.87. NYMEX October ULSD futures were 1.06 cents higher at $1.7967 gallon, holding near a 26-month spot high of $1.7983. The October RBOB futures contract edged up 0.70 cent to $1.6680 gallon after inside trade.

George Orwel can be reached at george.orwel@dtn.com