Oil prices mixed as production cuts hit oil

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Oil prices mixed as production cuts hit oil

Early on Wednesday, oil prices in early Asian trade were mixed as U.S. production cuts caused by Hurricane Ian contended with crude storage builds and a strong dollar.

By 0022 GMT, Brent crude futures fell 4 cents, or 0.1%, to $86.23 per barrel, while U.S. West Texas Intermediate WTI crude futures were up 22 cents at $78.03 per barrel.

After shutting in output ahead of Hurricane Ian, which entered the U.S. Gulf of Mexico on Tuesday, producers began returning workers to offshore oil platforms, and are forecast to become a Category 4 storm over the warm waters of the Gulf.

According to the Bureau of Safety and Environmental Enforcement, BSEE producers lost 184 million cubic feet of natural gas, or nearly 9% of daily output, or nearly 190,000 barrels of oil per day of oil production. The BSEE said that personnel were evacuated from 14 production platforms and rigs.

Ian is the first hurricane this year to disrupt oil and gas production in the U.S. Gulf of Mexico, which produces about 15% of the nation's crude oil and 5% of dry natural gas.

The U.S. dollar was the limit on oil prices. The dollar, which typically trades inversely with oil, remained near a 20 year high.

Estimates of U.S. oil in storage sent mixed messages about oil prices.

The U.S. crude oil in storage increased by about 4.2 million barrels for the week ending Sept. 23, according to market sources. American Petroleum Institute, gasoline inventories fell by about 1 million barrels.

According to the sources, distillate stocks rose by about 438,000 barrels.