Oil Shares Follow Hurricane Ida, Weaken Ahead of OPEC’s Output Raise By Investing.com

Investing.com – Shares of oil companies traded lower Monday as Hurricane Ida weakened and members of oil cartel OPEC+ meet Wednesday to discuss a scheduled 400,000 barrels per day increase in output.

ADRs of BP (NYSE:) and Shell (NYSE:) and stocks of Chevron (NYSE:), Exxon Mobil (NYSE:) and Occidental Petroleum (NYSE:) fell by 0.5% to 1% each. Marathon Petroleum (NYSE:) was down 1.4%.

U.S. crude was flat at $68.70 at 10:30 AM ET, having earlier touched $69.64, the highest since August 6. Brent was flat at $71.64, having touched $73.69 earlier, the highest since August 2.

According to a CNN report, Ida will now move as a Category 1 storm into Mississippi, Tennessee and West Virginia, though there could be significant rainfall still.

Nearly all offshore Gulf oil production, or 1.74 million barrels per day, was suspended in advance of the storm, according to Reuters. Major U.S. offshore oilfields fall along the route of the hurricane.

According to the Bureau of Safety and Environmental Enforcement, roughly 85% of production in the Gulf of Mexico is shut.

The Gulf of Mexico federal offshore oil production accounts for 17% of the country’s crude oil production and 5% of its offshore dry gas output, according to the U.S. Energy Information Administration.

“It’s still early days,” Vivek Dhar, analyst at Commonwealth Bank of Australia (OTC:) told Reuters. “Oil products, like gasoline and diesel, are likely to see prices rise more acutely from refinery outages especially if there are difficulties in bringing refineries and pipelines back online.”