NEWS:Hurricane Katrina Raises Oil Prices

Oil prices rose to a new high after Hurricane Katrina whipped through the Gulf of Mexico. Sources say that at least 560,000 barrels of daily crude oil have been lost; attributing the causes to rigs that had to be shut down during the weekend and facilities being evacuated. Some that have not closed completely are operating only with a skeleton crew. ExxonMobil, Shell and Total were among those that were closed.



This does not bode well. Katrina is not even finished raging yet. Some may say she hasn't even started. I hope that this does not cause prices to raise even higher than they are now. But if more stations are closed around the gulf, I don't see how it won't happen. On top of the damage and possible loss of life, another raise in oil prices could be devastating.



[edit on 28-8-2005 by asala]

A budgie farts in Boston and the price of oil rises, or so it seems lately. How does the loss of half a million barrels of oil for a few days impact the price of oil? When countries like Saudi Arabia are exporting 7 or 8 million barrels a day you'd think it wouldnt impact that much.

I feel there is a concerted profiteering campaign being waged here by the oil companies. They could absorb these minor fluctuations like they have done for decades but lately they are cashing in big time.

Just looked up the figures. The World's production of oil is 76 million barrels of oil per day. So this hurricane has temporarily removed roughly 1/152th (or 0.65%) of total oil production. Why the price rise again?

[edit on 28/8/05 by subz]

Good budgie analogy - I think you are right. They are looking for reasons to raise praises again and this hurricane is (literally) heaven sent, while at the same time being a disaster for anyone unfortunate enough to live in the area, trying to evacuate and not giving a damn about the oil.

A natural disaster will enable those that benefit to raise the oil prices again and this time with a valid reason. What else are they supposed to do? After all it isn't *their* fault there was a hurricane.

God, don't we sound cynical. But it shows where people's real interests are. I hope I'm wrong about this and nothing gets raised and the only worry for all concerned is the safety of the people affected and the immediate rebuild in the aftermath.

Please do not edit the (submissions ) from the title,



[edit on 28-8-2005 by asala]

An update on this. As the hurricane gets closer to New Orleans, oil producing companies have started to evacuated the area. This was thought to be a four day storm that would take it's toll temporarily on production, but things have worsened.

Now a category 5 hurricane, Katrina is moving slowly into an area central to oil and gas production -- and oil companies have begun evacuating production sites throughout the Gulf of Mexico and the southern United States.

Fears of the potential effects of the hurricane were largely behind the price spike that has seen oil go about $US67 a barrel, but some of that pressure fell off after it appeared the hurricane would miss major production facilities.

That is no longer the case.

Won't post all the info. Here is the link:
www.nbr.co.nz...

It's not the production that is going to cause the biggest problem in oil prices it's the fact that a ton of our oil imports come thru that port!
Take a look at this article.
money.cnn.com...

concidering that the US uses 20 million gallons of gas a day and imports 10 million a day. concidering that most of the US domestic oil comes from that area the priceis bound to go up as supply dwindles and demand remains constant.

in short, the prce goes up because we are too dependant on it

Just for the record it is not 20 million gallons a day.

US OIL DEMAND, 2004: Over 20 million barrels per day, up from January 2002, when demand was about 18.5 million barrels per day, = 777 million gallons.Source

The area that Katrina on path to hit has many oil refineries, not to mention all the rigs out in the gulf. This will be a huge blow for the cost of oil. In a worst case scenerio I believe gas could make to over $4.00 a gallon.

online oil trading has oil already at over $70.00 a barrell!!!!!! it just opened!!!!

NEW RECORD $70.80 for Crude oil Futures and trading has just started, prepare for a wild ride everywhere tomorrow.

U.S. oil surges $4 to record above $70

[edit on 8-28-2005 by worldwatcher]

You can watch oil prices here.
www.bloomberg.com...

69.75 atm

The Gulf of Mexico produces between 20% and 25% of oil consumed in the US.

Consider the cost of transporting oil into the U.S. from the Gulf of Mexico.

Consider the cost of transporting oil from the Middle East.

I wouldn't be surprised to see oil prices raise considerably......especially if an intensified Katrina continues wreaking havoc and temporary closing of the rigs is retrospectivally viewed as having been on the wish list.....

[edit on 28-8-2005 by MemoryShock]

CNN News Just reported 70.80! Over 40% production in the area shut down.

Arent we supposed to be refining coal to gasoline?

Still worries about the oil rigs in the Gulf. Bush may be pulling out the oil reserves. We will know later.

"President Bush could announce a release of supply from the Strategic Petroleum Reserve," said commodity strategist David Thurtell of Commonwealth Bank of Australia in Sydney. "(That's) the only thing that will prevent further significant price rises from here."

The Bush administration has said the petroleum reserves should be tapped only when there are disruptions of oil imports from overseas.

edition.cnn.com...

[edit on 29-8-2005 by nikelbee]

Another update:

Opec's president has said he will ask for the cartel to raise its output as oil prices surged to new records as Hurricane Katrina hit US production.

Opec head Sheikh Ahmad al-Fahd al-Sabah vowed to call for a 500,000 barrels a day rise in output at its next meeting.

The move was a bid to calm supply fears which have risen as the hurricane shut down production in the Gulf of Mexico.

news.bbc.co.uk...