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Oil prices rose over 1 percent on Wednesday in light of the ongoing high production outages in the Gulf of Mexico.

Benchmark Brent crude futures climbed 1.1 percent to $72.44 a barrel, while U.S. crude futures were up 1.3 percent at $69.22.

More than 80 percent of oil production in the Gulf of Mexico remains shut due to structural damage caused by Hurricane Ida, leading to ongoing power outages.

The resulting disruption has seen the value of regional oil grades like Mars Blend jump to their highest level since January, according to data compiled by Bloomberg.

“Because of this outage on the supply side, the global oil market is likely to be more under-supplied in the short term than previously anticipated,” Commerzbank analyst Carsten Fritsch said.

Oil prices were also boosted by reports suggesting that there are pockets of robust demand emerging in some regions including Europe.

Traders await inventory data from the American Petroleum Institute industry group later in the day and the U.S. Energy Information Administration on Thursday for further direction.


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