Oil lost about 2.7 percent of its value last day, traded at about $46.57 a barrel after the tropical storm Harvey struck US refineries. Although light oil futures declined by nearly 3% on Monday, gasoline prices rose to 2-year highs as the storm continued to hit the Gulf of Mexico, damaging several refineries. This, in turn, has prevented fuel production.
Mass floods forced the refineries in the area to close. As a result, futures on light crude oil have fallen. Futures on the Brent variety last traded at about $51.75 a barrel at a decline of 1.3% or 66 cents. The difference in prices of light crude oil and Brent rose to $5.50, which is the highest value in 2 years.
Shares of petroleum refinery companies rose at the start of the week. The reason for this is the closure of many refineries in Houston, which was hit by the tropical storm Harvey. Peter Kardillo, a First Standard Financial economist, commented that since some of the major refineries are not operating in Houston, gasoline prices are up, which reflects stock prices. The shares of Valero Energy, Phillips 66 and Marathon Petroleum closed in green. Outside this sector stock markets traded with mixed results.
Gold climbed to its highest level from more than a week on Monday after the dollar continued its weakness and the euro stepped up after Mario Draghi’s statement on Friday. Spot Gold rose 1.42% to 1309.41 dollars per troy ounce, and US futures for December rose 1.3% to 1315.30 dollars per troy ounce.
An additional role for the strong trading session in gold played also the uncertainty surrounding the NAFTA agreement. Data showed that traders increased their net long positions in gold for the sixth consecutive week. At the beginning of today, gold continued to rise after the news that North Korea launched a new ballistic missile that had flown over Japan.