Prices of crude oil were high by 76 cents, or 1.2 per cent, at $61.67 a barrel by 0104 GMT. The hike resulted after attaining nearly 1 per cent last week. Also, U.S. oil rose by 74 cents, or 1.3 per cent, to $59.98 a barrel, having fallen 0.4 per cent last week.
Oil prices climbed as the passive return of U.S. crude manufacturing chopped by freezing situations heightened attention about supply just as demand is growing back from the intensities of the coronavirus pandemic.
According to analyst estimation, abnormal cold weather in Texas and the Plains republics required the shutdown of up to 4 million barrels per day (BPD) of crude production with additions of 21 billion cubic feet of natural gas production.
As a result, oil field companies will probably take some days to de-ice valves, restart systems, and start oil and gas production. U.S. Gulf Coast refiners evaluate the damage to pieces of equipment. Accordingly, they may need up to two to three weeks to restore the majority of their operations. Further, the expert said that with low water pressure, gas and power troubles, and it hampers restart procedure.
According to available research analytics, "with three-quarters of fracking crews standing down, the likelihood of a fast resumption is low."
Further, the report states, "long term, the fall in capital expenditure at U.S. shale oil companies this year will keep drilling activity subdued, leading to output remaining below pre-pandemic levels."
Since November, for the first time, U.S. drilling companies reduced the number of oil rigs working due to the cold and snow covering Texas, New Mexico and other energy-producing centres.