U.S. crude inventories fall 3.2 million barrels, defying forecasts

Oil futures climbed more than 2% on Thursday as Houthi strikes damaged two Saudi airports, including one in Riyadh; another tanker was struck in the Persian Gulf; and U.S. Gulf of Mexico production shut-ins grew ahead of Hurricane Isaias’s expected Friday approach to the northern Gulf Coast. Analysts at InTouch Capital Markets said “Renewed Houthi attacks in Saudi Arabia and storm-related U.S. Gulf production shut-ins have helped boost oil prices.”

December Brent crude futures rose 2.6% to $102.79 a barrel, while December West Texas Intermediate futures gained 2.2% to $89.46 a barrel.

Attacks claimed by Houthi militants damaged two airports in Saudi Arabia, including one in the capital Riyadh, killing three people and wounding 36 others, The Wall Street Journal reported. The two attacks, which took place on Tuesday and Wednesday, also caused material damage. Saudi-led coalition forces said they had destroyed 82 Houthi military targets across Saada, Hodeidah, Al-Jawf, and Marib in response to recent attacks on Saudi civilian infrastructure. The Houthis have also warned international airlines against using Saudi airspace, except over Mecca and Medina, the Journal reported.

Shipping risks in the Persian Gulf also remain elevated. A tanker was struck by multiple projectiles Wednesday about 51 nautical miles north of Madinat ash Shamal, Qatar, the U.K. Maritime Trade Operations said. Casualties were reported, while authorities were investigating the incident.

On the U.S. supply side, the National Hurricane Center said Isaias strengthened into a hurricane late Wednesday, with maximum sustained winds of about 75 miles an hour. The storm is expected to approach the northern U.S. Gulf Coast on Friday. The U.S. Marine Minerals Administration said 511,619 barrels a day of Gulf production, or 25.08% of the region’s current output, had been shut in as of Wednesday morning. Personnel had been evacuated from eight production platforms and two drilling rigs, while another rig was moved out of the storm’s path.

U.S. crude inventories also fell unexpectedly last week. Commercial crude stocks declined by 3.2 million barrels to 424.1 million barrels in the week ended Oct. 2, according to the Energy Information Administration. A Wall Street Journal survey had expected inventories to increase by 1.7 million barrels.