Oil prices edged up on Thursday 27.08.2020, with the market nervously monitoring Hurricane Laura as nearly half of America’s refining capacity is located in Texas and Louisiana, and over 13% of national refining capacity is already disabled.
Producers have already shut down 1.56 million barrels per day of crude oil output, as well as evacuating 310 offshore facilities.
Hurricane Laura is already stronger than Hurricane Katrina, only seven miles per hour, and it will become a Category 5 storm.
The "Unsurvivable" storm surges up to 15 feet and can overwhelm parts of the Gulf Coast, warns The National Hurricane Center.
Port Arthur the oil-refining town was directly in Laura's path. The city of 54,000 was empty on Wednesday afternoon 26.08.2020.
From Louisiana and Texas, 620,000 people are under mandatory evacuation orders. Crude oil production has been paralyzed in the Gulf of Mexico, companies shut down operations. Output cuts are at a staggering number of nearly 90%; that level was not seen since 2005 after Hurricane Katrina.
Such hurricanes as Harvey and Katrina before have wreaked havoc on the oil industry sites dotting the Gulf Coast, where almost half of the United States' oil refining capacity is located. There are concerns Laura may do the same.
U.S. China relationship is under pressure again. China fired four medium-range ballistic missiles into the disputed South China Sea during military exercises, while Washington placed sanctions on a further 24 Chinese companies.
However, the market participants will focus on the Jackson Hole symposium, held virtually later Thursday, where U.S. Federal Reserve Chairman, Jerome Powell, will deliver a speech regarding the central bank's new strategy for meeting its price stability and maximum employment goals.
European stock markets are set to open lower Thursday 27.08.2020 amid further tension between the two largest economies in the world: U.S. and China.