Global oil demand to exceed expectations in 2017, says International Energy Agency

US Hurricanes Affecting Oil Prices, Saudi Could Cut Output

Hurricanes Harvey and Irma to support crude oil prices; buy on dips

Looking ahead, the monthly reports from the OPEC and IEA will be awaited this week for data on market balances and the level of global inventories. Higher crude oil prices have a positive impact on oil and gas producers like Apache (APA), W&T Offshore (WTI), Contango Oil & Gas (MCF), and Denbury Resources (DNR).

According to the report, the value of Iranian heavy crude was further lifted buoyed again by an uplift in OSP offsets and supported by healthy global sour markets. That's up from its August estimate of 1.5 mb/d and a forecast of 1.4 mb/d, in the July IEA report.

With the data release Tuesday, the worldwide Brent price of oil was up 0.7% to $54.24 per barrel in recent trading, while the US benchmark price was up 0.2% to $48.17. Interestingly, pump prices rose by a higher absolute amount per gallon in Texas (40 cents per gallon) and Houston (35 cents per gallon), but the averages for Texas ($2.56 a gallon) and Houston ($2.43 a gallon) remained lower than the national average.

Brent crude, the global benchmark for oil, settled just higher, despite Saudi Arabia and the United Arab Emirates saying they were open to extending production cuts for the Organization of the Petroleum Exporting Countries (OPEC) when the cartel's deal with Russian Federation and other global producers to reduce 1.8 million barrels per day expires in March 2018.

The longer-term focus, however, was on a possible extension to the 15-month production pact between members of the Organization of the Petroleum Exporting Countries and non-OPEC producers including Russian Federation. Total volume traded was about 3% below the 100-day average. Data from industry group the American Petroleum Institute (API) was due later on Tuesday while the U.S. Department of Energy's Energy Information Administration (EIA) will release its numbers on Wednesday (9/13).

The cartel's production dropped by 79,100 barrels per day (bpd) to 32.76m bpd last month, according to secondary sources that measure Opec output.

Saudi Arabia has energy-reliant economy continues to struggle since oil prices tanked in 2014. Inventories of gasoline and distillate were expected to fall 4 million barrels and 300,000 barrels, respectively. At the same time, crude inventories climbed by 5.89 MMbbl to 468.2 million, while refinery utilization sunk.

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