Hurricane Ida has made prices for oil fluctuate over the past week but prices should remain around $70 a barrel for a while says oil industry experts.

According to the Midland Reporter-Telegram, other factors including the COVID-19 pandemic are also keeping prices around $70 a barrel.

“The market is now laser focused on the supply situation in the U.S.,” Andrew Lebow, Senior Partner at Commodity Research Group, “The losses from the extended outage in the Gulf are being felt more.”

West Texas Intermediate evenly split its gains and losses in a shortened week last week thanks to the Labor Day holiday.

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But even with a short week, the price still stayed within five dollars of the $70 a barrel average.

“There is always something interesting happening,” Economist Ray Perryman commented to the Midland Reporter-Telegram by email. “I expect oil prices to stay in the current range for a while – high $60s to low $70s per barrel. The current drama of the day is that China is selling some of its stockpile. That could put downward pressure on the price, although markets principally served by WTI are unlikely to be much affected. The biggest downside risk is that the pandemic reaches a level where shutdowns, restrictions, and travel limitations once again reduce global demand.”

Natural gas prices are expected to remain higher in the next few months thanks to Hurricane Ida.

“The natural gas prices are likely to not be sustainable at around $5 per MCF over the next few months," said Perryman. "I would expect to see some reductions, though not to the very low levels we have seen in recent years. The current drama there is that we are still dealing with some of the aftermath of Hurricane Ida on the supply side, which will correct itself soon. The other issue is that Russia is playing games with Europe, where supply is more tenuous, and threatening its recovery.”

So for now expect oil prices to remain around $70 a barrel and natural gas to be below $5.

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