SINGAPORE – Crude prices fell in Asian trade on Monday, with energy demand hit by the closure of refineries and airports on the US east coast as people sought shelter from tropical storm Irene, analysts said.
New York’s main contract, light sweet crude for delivery in October, fell 13 cents to $85.24 a barrel.
Brent North Sea crude for October delivery sank 28 cents to $111.08.
Reduced energy demand from flights being grounded and people staying at home while Irene lashed the US east coast coupled with oil refineries escaping the brunt of the storm dampened crude prices, analysts said.
“I expect that oil should be under downward pressure today,” said Victor Shum, senior principal of Purvin and Gertz energy consultants in Singapore.
“The refineries on the east coast have by and large not been damaged… Demand has been reduced because people stayed home and a number of airports on the east coast have been shut down, therefore cutting demand,” he told AFP.
Despite causing widespread flooding in several US states, grounding more than 10,000 flights and claiming at least 18 lives, oil refineries on the US east coast escaped from Irene relatively unscathed.
Damage to the facilities would likely have raised fears of an energy supply crunch and pushed up prices.
Irene had on Sunday been downgraded from a hurricane to a tropical storm, but was still packing winds of 85 kilometres an hour (50 miles an hour).