Oil Extends Rally on Texas Supply Disruptions

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Oil prices advanced further on Wednesday, underpinned by major supply disruption in the south of the United States this week, caused by a historic winter storm in Texas.

U.S. West Texas Intermediate WTI crude futures rose 41 cents, or 0.68, to 60.46 a barrel at 0752 GMT.

Brent crude futures gained 44 cents, or 0.69, to 63.79 a barrel.

Oil prices have run up strongly in recent months and output disruptions caused by the storm in Texas, the countrys largest oil producing state, continued to keep prices supported, analysts said.

ANZ and Citigroup analysts estimated at least 2 million barrels per day bpd of U.S. shale oil production has been curtailed. Citi estimated a cumulative production loss of around 16 million barrels through early March.

But the extreme cold has also hit crude demand due to disruptions to refinery operations. Chevron Corps 112,229 barrelperday bpd Houstonarea refinery in Pasadena, Texas, was shut on Tuesday, the company said.

The stronger price environment has put more attention on OPEC, who will meet to set policy on March 4, analysts said.

The impact on crude oil prices will largely depend on how long the power crisis will last, but eventually prices will likely return to the fundamentals with a focus on the global energy demand and OPEC, said Margaret Yang, a strategist at Singaporebased DailyFX.

OPEC oil producers are likely to ease curbs on supply after April given a recovery in prices, OPEC sources told Reuters.

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