Crude oil pared some gains towards the end of the session on Tuesday, after having risen sharply earlier, but still settled modestly higher, amid expectations of a drop in supply.
The retreat from higher levels was due largely to reports that disruptions to energy production in the Gulf of Mexico region due to hurricane Gordon may not be severe as feared earlier. A report from Genscape that showed a rise in
supplies at a delivery hub at Cushing, Oklahoma, also contributed to oil’s fall from higher levels.
Oil prices rose past $70 a barrel earlier in the day as tropical storm Gordon headed north towards the Louisiana coast, forcing the closure of several drilling installations in the Gulf of Mexico.
Possible supply disruptions in Libya, the impact of U.S. sanctions on Iran too aided oil’s move past $71 a barrel mark.
Crude oil futures for October delivery ended up 0.1%, at $69.87 a barrel, after rising to a high of $71.40 intraday.
On Friday, crude oil futures ended down $0.45, or 0.6%, at $69.80 a barrel. Crude oil futures gained about 1.6% last week and gained about 3.2% in August.
Meanwhile, traders looked ahead to crude oil inventory data from the American Petroleum Institute due later in the day, and the official report from Energy Information Administration, due Wednesday morning.