Oil holds at $109 on demand concerns
Oil prices were little changed near $109 a barrel on Thursday as traders weighed concerns over slowing demand from major consumer countries against further hurricane threats to the U.S. oil sector.
Oil hovers at $102Prices have tumbled by more than $6 since Friday after Hurricane Gustav, which swept through the major oil-producing Gulf of Mexico and made landfall near New Orleans on Monday, turned out to be less destructive than feared.
U.S. crude slipped 15 cents to 109.20 a barrel by 0632 GMT (7:32 a.m. BST) while London Brent crude fell 6 cents to $108.00, a sixth consecutive day of losses.
Signs of slowing oil demand in the United States and other consumer nations have helped drag oil prices well below their peak near $150 hit in July, but many traders remain anxious that new storms may not spare oil facilities.
"There are still concerns over supply issues. A lot of the Gulf of Mexico capacity was shut down and some refineries are still closed. We don't know how long they'll remain offline," said Gerard Rigby, an analyst at Fuel First Consulting in Sydney.
Companies closed 14 refineries and shut in all of the 1.3 million barrels per day of oil production in the Gulf at the peak of Gustav's impact on Monday. By Wednesday, some refineries and offshore production were coming back online, but other facilities remained paralysed by a lack of reliable power.
Forecasters expect a total of 14 to 18 tropical storms during this year's season, which runs through November, above the historical average of 10.
"We're still in the hurricane season after all. Gustav sort of disappeared, but there are more hurricanes to come," said Rigby.
On Thursday, Hurricane Ike strengthened into an "extremely dangerous" Category 4 hurricane in the Atlantic, although it is too early to tell which land areas it will hit, the U.S. National Hurricane Center said.
Tropical Storm Hanna intensified to a slighter degree as it swirled over the Bahamas toward the southeast U.S. Coast.
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