Oil rose for a second day in New York on speculation a storm building in the Gulf of Mexico poses a threat to supplies in the U.S., which were reduced last week by an earlier cyclone. Futures rose as much as 0.9 percent after the industry- funded American Petroleum Institute said inventories fell 2.97 million barrels. An Energy Department report today may show supplies dropped by 2 million as Tropical Storm Lee shut output, a Bloomberg News survey showed. Three weather systems are churning in the Atlantic basin after Nate formed yesterday. “The number of hurricanes in the Gulf and the East Coast is a bit higher than usual, so that could push down production levels,” said Tetsu Emori, a commodity fund manager at Astmax Co. in Tokyo. “Inventory levels of oil and products in the U.S. aren’t getting much higher so the down side should be quite limited.” Crude for October delivery rose 18 cents, or 0.2 percent, to $89.52 a barrel in electronic trading on the New York Mercantile Exchange at 1:44 p.m. Singapore time. The contract yesterday rose $3.32 to $89.34, the highest close since Aug. 3. Prices are up 20 percent from a year ago. Brent oil for October settlement traded at $115.69 a barrel, down 11 cents, on the London-based ICE Futures Europe Exchange. Prices have risen 48 percent from a year ago. Europe’s benchmark contract was at premium of $26.21 to U.S. futures, compared with the record settlement of $26.87 on Sept. 6. DOE Report The U.S. Energy Department will release its weekly stockpile data at 11 a.m. today. The API and government reports are a day late because of the Labor Day holiday on Sept. 5. Gasoline inventories dropped 871,000 barrels last week to 209.9 million, the API data shows. The government report may show they declined 1.4 million, according to the median of 15 analyst estimates in the Bloomberg News survey. Distillate-fuel supplies, a category that includes heating oil and diesel, increased by 3.95 million barrels to 157.1 million, according to the API data. The Energy Department report may show they rose by 500,000 barrels, the survey shows. Oil-supply totals from the API and the department have moved in the same direction 71 percent of the time in the past year. The API collects data on a voluntary basis from operators of refineries, bulk terminals and pipelines. The government requires that reports be filed for its weekly survey. About 37 percent of U.S. oil production and 18 percent of natural gas output from the Gulf of Mexico has been halted as Tropical Storm Lee passed through the region last week, according to the Bureau of Ocean Energy Management, Regulation and Enforcement. The Gulf is home to 27 percent of U.S. oil output and 6.5 percent of the country’s natural gas production. Tropical Storm Nate Nate, with winds of 45 miles (72 kilometers) per hour about 135 miles west-northwest of Campeche, Mexico, joins Hurricane Katia and Tropical Storm Maria. Nate is forecast to be a Category 1 storm with winds of 75 mph in two days. The statistical peak of the six-month Atlantic hurricane season comes in three days. This year has produced storms at a faster rate than 2010, when a total of 19 named systems roared through the basin. The 14th storm didn’t form until Sept. 29 last year. Brent’s premium to New York futures widened to a record this week amid speculation the resumption of Libyan crude output may be prolonged. The country may take at least 18 months to restore output to pre-war levels because of delays in establishing political stability and the advanced age of the country’s oilfields, Francisco Blanch, Bank of America Corp.’s New York-based head of commodities research, said in a Sept. 6 report. Fighting in Libya, which began in February, has reduced the availability of light, sweet crude, or oil with low density and sulfur content. The country’s output fell to 45,000 barrels a day last month, according to Bloomberg estimates, compared with the 1.6 million barrels a day the nation pumped in January. To contact the reporters on this story: Ben Sharples in Melbourne at bsharples@bloomberg.net; Christian Schmollinger in Singapore at christian.s@bloomberg.net To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net

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