LONDON (AFP) - Oil prices climbed as disruption to production in the Gulf of Mexico continued due to Hurricane Ivan.
The price of Brent North Sea crude oil for delivery in November, the new benchmark contract, rose by 71 cents to 41.06 dollars a barrel in early trading on Thursday.
New York's light sweet crude for October delivery gained 42 cents to 44.00 dollars in pre-opening electronic deals, having closed down 81 cents on Wednesday.
"The market is still very nervous about this hurricane in the States," said trader Kevin Blemkin at GNI-Man Financial.
"We are waiting for the US (market) coming this afternoon with any news from the hurricane. We could see a further sell off as the market is very, very nervous at the moment."
According to the latest report from the US Minerals Management Service, workers on 575 platforms and 69 rigs had been evacuated from the Gulf of Mexico.
About 78 percent of the 1.7 million barrels-per-day of oil production in the Gulf was halted.
The biggest US oil import terminal, the Louisiana Offshore Oil Port, stopped unloading tankers on Monday.
Hurricane Ivan's eyewall slammed ashore near Mobile, Alabama early Thursday, leaving the Gulf of Mexico and making its way inland.
It already killed more than 70 people as it made its way across the Caribbean.
Traders were concerned that the hurricane would lead to another drop in US crude oil inventories.
The US Energy Department reported Wednesday that US crude stocks tumbled by 7.1 million barrels to 278.6 million in the week to September 10, reaching the lowest levels in nearly seven months,
"The oil markets remain subject to upside risk from geopolitical issues such as sabotage in Iraq and events like Hurricane Ivan in the Gulf of Mexico, which has temporarily put more than 1.0 million barrels a day of US production on hold as platforms have been evacuated," Deutsche Bank analysts Adam Sieminski and Jay Saunders wrote in a research note.
Markets remained unfazed by a decision by the OPEC oil cartel to raise its official output quotas by almost four percent to 27 million barrels per day (bpd) from November 1.
Ministers said Wednesday's decision would have no impact on OPEC's actual output, which was already running some two million bpd over the official ceiling.
"OPEC mildly surprised the market with a one million bpd increase in quotas despite early indications that they might not make changes to either quotas or the price band at this meeting," the Deutsche Bank analysts said.
"The ministers portrayed the decision as a 'signal' to the market that they would like to see lower prices, despite the widely held belief that the quota change will have virtually no impact on actual output."