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Oil futures prices continue to rise amid Hurricane Beryl

Oil futures MCL 2024 07 02

On the picture. Oil futures are testing the technical resistance level line on the Daily charts.

Oil futures rose on Tuesday, reaching their highest levels since late April. The rise was driven by expectations of heavy traffic during the Independence Day holiday and fears that powerful Hurricane Beryl could subsequently disrupt crude oil production offshore the Gulf of Mexico.

West Texas Intermediate crude futures CL00 for August delivery CL.1 CLQ24 rose 59 cents, or 0.8%, to $84.05 a barrel on the New York Mercantile Exchange. Brent crude futures for September delivery BRN00 BRNU24, the global benchmark, rose 58 cents, or 0.7%, to $87.18 a barrel on ICE Futures Europe.

Market drivers

WTI ended Monday at its highest level since April 26, while Brent posted its strongest performance since April 30, partly driven by expectations of strong tourism on Thursday, the July 4 holiday. AAA predicts a record 60.6 million people will travel by car during Independence Day week, up 2.8 million from last year. This will also surpass the 55.3 million people who traveled by car during the 2019 holiday period, AAA reports.

Meanwhile, Hurricane Beryl struck Carriacou Island in Grenada, becoming the earliest Category 4 storm in Atlantic history, and the National Hurricane Center in Miami later reported winds had reached Category 5 strength.

Beryl is not expected to have an immediate impact on operations in the Gulf of Mexico, but may cause disruption later this week.

Risks for crude oil remain on the upside, with the next target for WTI futures at $85/bbl.

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