Yahoo Finance Oil prices rise amid Hurricane Beryl concerns, Middle East tensions
Oil prices remained near a two-month high on Tuesday as the first Category 5 hurricane of the season threatened to disrupt the markets and tensions in the Middle East showed no signs of abating.
West Texas Intermediate (CL=F) topped $83 per barrel while Brent (BZ=F) hovered above $86 per barrel in midday trading.
Traders are keeping a close eye on Hurricane Beryl in the Caribbean, the earliest Category 5 storm on record.
“The weather agencies are suggesting that this is going to be a very active hurricane season," TD Cowen managing director Jason Gabelman told Yahoo Finance on Tuesday.
"If [hurricanes] hit the Gulf Coast, it could disrupt that center of US refining capacity, which is about 50% of total capacity in the US," he said.
Analysts are keeping an eye out for Mexico's oil output. The country is responsible for about 5% of global production. Hurricane Beryl is expected to threaten Jamaica on Wednesday and continue toward Mexico's Yucatan Peninsula this week.
"Gulf Coast refineries import about 400,000 barrels per day of crude oil from Mexico, representing 25% of the crude oil that is imported into the Gulf Coast. Damage to the oil production facilities as well as to the export locations is a possibility," wrote Andy Lipow, president of Lipow Oil Associates, in a note on Tuesday.
Rising demand heading into the summer has also helped lift crude prices in recent weeks. In June, WTI gained roughly 6%.
Lipow has called for $90 Brent given concerns of a broader cross-border conflict in the Middle East involving Iran, an oil-producing country.
Wall Street widely predicts slowing demand amid greater supply will send prices lower next year, with JPMorgan analysts forecasting Brent to average $75 in 2025, sharply down from $83 in 2024.
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre.
Correction: A previous version of this article misspelled Jason Gabelman's name. We regret the error.
