Oil futures rose Thursday, lifted as strikes in Norway continue to weigh on production in the North Sea and Hurricane Delta forces the shut-in of crude and natural-gas production in the Gulf of Mexico.
West Texas Intermediate crude for November delivery rose 74 cents, or 1.9%, to $40.69 a barrel on the New York Mercantile Exchange. December Brent crude, the global benchmark, was up 87 cents, or 2.1%, at $42.87 a barrel on ICE Futures Europe.
Gains came “because the problems on the supply side can no longer be ignored,” said Carsten Fritsch, analyst at Commerzbank, in a note.
Widening strike action could cut output in Norway, Western Europe’s largest oil producer, by a quarter, operators said on Thursday, according to Reuters.
“The strike in Norway could now also affect the country’s largest oil field – Johan Sverdrup — which has a daily production capacity of 470,000 barrels,” Fritsch said, in a note.
If production was halted there, outages at all strike-affected oil fields would total 941,000 barrels per day, he said, noting the operator said production would need to be suspended if the strike, which began on Sept. 30, isn’t resolved by Oct. 14.
Meanwhile, the U.S. Bureau of Safety and Environmental Enforcement estimated that 80.42% of Gulf oil production and 49.26% of natural-gas output was shut in as of Wednesday afternoon in anticipation of Hurricane Delta. The hurricane strengthened back into a Category 2 storm as it moved further into the Gulf on Thursday and was expected to make landfall on the Louisiana coast on Friday.