Oil Rises on Large US Stockpile Draw, Hurricane Jitters

FILE PHOTO: A pipe yard servicing government-owned oil pipeline operator Trans Mountain is seen in Kamloops, British Columbia, Canada June 7, 2021. REUTERS/Jennifer Gauthier/File Photo
FILE PHOTO: A pipe yard servicing government-owned oil pipeline operator Trans Mountain is seen in Kamloops, British Columbia, Canada June 7, 2021. REUTERS/Jennifer Gauthier/File Photo
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Oil Rises on Large US Stockpile Draw, Hurricane Jitters

FILE PHOTO: A pipe yard servicing government-owned oil pipeline operator Trans Mountain is seen in Kamloops, British Columbia, Canada June 7, 2021. REUTERS/Jennifer Gauthier/File Photo
FILE PHOTO: A pipe yard servicing government-owned oil pipeline operator Trans Mountain is seen in Kamloops, British Columbia, Canada June 7, 2021. REUTERS/Jennifer Gauthier/File Photo

Oil prices extended gains on Wednesday after industry data showed a large draw in crude inventories in the US, the world's biggest fuel consumer, and as concerns about a hurricane in the Gulf of Mexico kept investors on edge.

Brent crude futures for October climbed 31 cents, or 0.36%, to $85.80 a barrel by 0415 GMT. The October contract expires on Thursday and the more active November contract was at $85.23 a barrel, up by 32 cents.

US West Texas Intermediate crude futures gained 38 cents, or 0.47%, to $81.54, logging its fifth session of gains.

Both benchmarks rallied more than a dollar a barrel on Tuesday as the US dollar slid after the prospects of further interest rate hikes eased following softer US job data.

US crude stocks declined by about 11.5 million barrels in the week ended Aug. 25, according to market sources citing American Petroleum Institute figures on Tuesday. Analysts polled by Reuters prior to the data had estimated on average a draw of 3.3 million barrels.

The bigger-than-expected draw in US crude oil stockpiles is positive for the oil market as it suggest firm demand, said Toshitaka Tazawa, an analyst at Fujitomi Securities Co Ltd.

At the same time, investors bought futures on concerns surrounding Hurricane Idalia, which is churning over the Gulf of Mexico to the east of major US oil and natural gas production sites.

"Concerns over the Hurricane Idalia prompted fresh buying," said Tazawa.

The offshore Gulf of Mexico accounts for about 15% of US oil output and about 5% of natural gas production, according to the Energy Information Administration (EIA).

Oil major Chevron Corp evacuated some staff from the region, but production was continuing at the sites it operates in the Gulf of Mexico.

Worries about fuel demand and the macroeconomic situation in China, the world's biggest oil importer, kept a lid on prices.

While China's economy regained some ground in July, following a contraction in June, the big picture is that various output indicators have levelled off recently and the economy could tip into a downward spiral unless policy support is ramped up soon, said Capital Economics analysts in a client note.



Riyadh Hosts Saudi-Egyptian Industrial Forum

Officials are seen at the forum on Monday. (SPA)
Officials are seen at the forum on Monday. (SPA)
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Riyadh Hosts Saudi-Egyptian Industrial Forum

Officials are seen at the forum on Monday. (SPA)
Officials are seen at the forum on Monday. (SPA)

The Saudi-Egyptian Industrial Forum kicked off in Riyadh on Monday under the patronage of Minister of Industry and Mineral Resources Bandar Alkhorayef. The forum aims to bolster strategic industrial cooperation and integration between the two countries.

Organized by the Federation of Saudi Chambers of Commerce in collaboration with the Federation of Egyptian Industries, the forum witnessed the participation of Deputy Minister for Industrial Affairs Eng. Khalil bin Salamah, Saudi Export Development Authority CEO Abdulrahman Althukair, and 300 prominent Saudi and Egyptian industry leaders and investors.

Bin Salamah underscored the significance of strengthening economic cooperation and industrial integration between Saudi Arabia and Egypt. He advocated for enhanced industrial partnerships within five priority sectors identified in the Kingdom's National Industrial Strategy: pharmaceuticals, automotive, building materials, textiles, and food industries.

He highlighted the evolving strategic integration between the two countries across initiatives like "Saudi Made,Future Factories," and "Made in Egypt," as well as in the broader goods and services sector. Bin Salamah urged Egyptian industrialists to capitalize on the industrial investment opportunities available in the Kingdom, citing its ambitious plans to establish 24,000 new factories over the next decade.

Federation of Saudi Chambers of Commerce Chairman Hassan Alhwaizy hailed the forum as a crucial milestone in Saudi-Egyptian industrial collaboration, emphasizing the strategic partnership underpinning their economic relations, particularly in the industrial sector.

Federation of Egyptian Industries Chairman Mohamed El-Sewedy stated that current global challenges are accelerating the need for industrial integration between the two countries, strengthening their partnership to tap into the African market's potential.

Saudi-Egyptian Business Council Chairman Bandar Al-Ameri highlighted the substantial growth in trade exchange between Saudi Arabia and Egypt in recent years, fueled by developing economic partnerships between their respective business communities. He emphasized that signing the agreement to protect and encourage mutual investments represents a strategic achievement serving their shared interests.