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Gas Prices Start To Rise As Hurricane Damage Prevents Oil From Being Refined
Oil prices clawed back above $69 as worries over the loss of Gulf of Mexico refining output after Hurricane Katrina outweighed the comfort to refiners of a U.S. government crude loan.
Motorists are paying more than $6 a gallon in some parts of the U.S. and in some European countries. Dutch motorists are faring the worst, paying up to $6.85 per U.S. gallon to fill up.
...
As much as 20 million to 40 million barrels of refinery throughput could be lost as the storm damage is repaired, including 14 million to 28 million barrels of gasoline, Barclays Capital estimates. That would further drain motor fuel stockpiles that already stand 7 percent below last year.
Savage Katrina, which may have killed hundreds as it hit the U.S. Gulf Coast on Monday, has shut down nine refineries in the region, straining an industry that has been working nearly flat out this year to satisfy growing consumer demand.
It also shut 91 percent of the normal 1.5 million barrels per day of Gulf of Mexico crude production and 83 percent of the normal 10 billion cubic feet of natural gas output, the U.S. Minerals Management Service said on Wednesday.
More
http://edition.cnn.com/2005/BUSINESS/09/01/oil.fears.reut/
Gasoline rose as much as 7.3 percent after Hurricane Katrina shut at least eight refineries, reducing U.S. fuel production by more than 10 percent and leading to scattered shortages.
Gasoline futures have soared this week after the storm swept through Louisiana and Mississippi, flooding refineries and shutting down pipelines. Pump prices yesterday jumped 50 cents to more than $3 a gallon in Ohio, Michigan, Indiana, Kentucky, Illinois, Wisconsin and Minnesota, said Brad Proctor, founder of Gaspricewatch, which relies on volunteers to track retail markets.
The first refineries ``will come on in six or seven days, and the last ones probably in three to four weeks, and that's going to create some shortages,'' said Charles Maxwell, senior energy analyst at Weeden & Co. in Greenwich, Connecticut. Pump prices for most of the U.S. will ``even out at somewhere around $3.50 to $4. That is going to be a shock to the system.''
http://www.bloomberg.com/apps/news?pid=10000086&sid=a30ae27372WU&refer=latin_america
Oil prices have fallen back from record levels after the US said it will release crude from its emergency stock following Hurricane Katrina.
However, the price of gasoline jumped higher on concerns that refineries will take time to get back to full output.
Analysts have been warning that high petrol prices may deter consumers from spending and slow economic growth.
New York light crude cost $69.02 a barrel on Thursday, down from a record $70.85 but up from Wednesday's close.
Gasoline futures jumped as much as 7.3% to $2.42 a gallon (3.8 litres).
'Prime supplier'
Hurricane Katrina powered its way across the Gulf of Mexico earlier this week, damaging much of the oil infrastructure that was in its path before coming ashore and killing hundreds of people and devastating built up areas.
The city of New Orleans is to be fully evacuated and President George W Bush called Katrina "one of the worst natural disasters" the US had seen.
Katrina is likely to have a "more lasting impact on refinery production and the distribution system" than previous hurricanes, the US Department of Energy said.
Oil companies are currently assessing the damage and many oil rigs and platforms are missing, while a number of major refineries have closed.
"The Gulf Coast is a prime supplier through pipelines now shut due to lack of power and ocean-going barges unable to load from ports eradicated by the storm," said David Knapp, an analyst at Energyintel.
"The loss of critical gasoline flows... will stress markets over the next few weeks," he added.
The US Minerals Management Service estimated that 95% of the Gulf of Mexico's oil output was out of service following the hurricane, as well as more than 80% of natural gas production.
'Days of reckoning'
That has raised concerns among many analysts, who now see petrol prices increasing nationwide to beat previous records.
According to the AAA motor club, gasoline costs an average of $2.62 a gallon in the US, compared with $1.86 a year ago.
"On a national average, we could hit $3.25 at the pump easily, potentially even by this weekend," said Jason Schenker, an economist at Wachovia. "This is going to cut into consumer demand."
Mark Routt of Boston-based Energy Security Analysis said that his "rule of thumb is that the national average pump price will typically be 65 cents higher" than the market price.
"Most of that will get passed to consumers within three weeks," he added.
While it is true that the US economy is still motoring - it grew at an annual rate of 3.3% in the April to June quarter - the worry is that a significant dip in consumer demand would slam the brakes on the recovery.
"Depending on what we learn in the next few days, this may be the biggest oil-supply shock since the 1970s," said Daniel Yergin, an analyst at Cambridge Energy. "We are now in the days of reckoning."
http://news.bbc.co.uk/1/hi/business/4203414.stm
...
As much as 20 million to 40 million barrels of refinery throughput could be lost as the storm damage is repaired, including 14 million to 28 million barrels of gasoline, Barclays Capital estimates. That would further drain motor fuel stockpiles that already stand 7 percent below last year.
Savage Katrina, which may have killed hundreds as it hit the U.S. Gulf Coast on Monday, has shut down nine refineries in the region, straining an industry that has been working nearly flat out this year to satisfy growing consumer demand.
It also shut 91 percent of the normal 1.5 million barrels per day of Gulf of Mexico crude production and 83 percent of the normal 10 billion cubic feet of natural gas output, the U.S. Minerals Management Service said on Wednesday.
More
http://edition.cnn.com/2005/BUSINESS/09/01/oil.fears.reut/
Gasoline rose as much as 7.3 percent after Hurricane Katrina shut at least eight refineries, reducing U.S. fuel production by more than 10 percent and leading to scattered shortages.
Gasoline futures have soared this week after the storm swept through Louisiana and Mississippi, flooding refineries and shutting down pipelines. Pump prices yesterday jumped 50 cents to more than $3 a gallon in Ohio, Michigan, Indiana, Kentucky, Illinois, Wisconsin and Minnesota, said Brad Proctor, founder of Gaspricewatch, which relies on volunteers to track retail markets.
The first refineries ``will come on in six or seven days, and the last ones probably in three to four weeks, and that's going to create some shortages,'' said Charles Maxwell, senior energy analyst at Weeden & Co. in Greenwich, Connecticut. Pump prices for most of the U.S. will ``even out at somewhere around $3.50 to $4. That is going to be a shock to the system.''
http://www.bloomberg.com/apps/news?pid=10000086&sid=a30ae27372WU&refer=latin_america
Oil prices have fallen back from record levels after the US said it will release crude from its emergency stock following Hurricane Katrina.
However, the price of gasoline jumped higher on concerns that refineries will take time to get back to full output.
Analysts have been warning that high petrol prices may deter consumers from spending and slow economic growth.
New York light crude cost $69.02 a barrel on Thursday, down from a record $70.85 but up from Wednesday's close.
Gasoline futures jumped as much as 7.3% to $2.42 a gallon (3.8 litres).
'Prime supplier'
Hurricane Katrina powered its way across the Gulf of Mexico earlier this week, damaging much of the oil infrastructure that was in its path before coming ashore and killing hundreds of people and devastating built up areas.
The city of New Orleans is to be fully evacuated and President George W Bush called Katrina "one of the worst natural disasters" the US had seen.
Katrina is likely to have a "more lasting impact on refinery production and the distribution system" than previous hurricanes, the US Department of Energy said.
Oil companies are currently assessing the damage and many oil rigs and platforms are missing, while a number of major refineries have closed.
"The Gulf Coast is a prime supplier through pipelines now shut due to lack of power and ocean-going barges unable to load from ports eradicated by the storm," said David Knapp, an analyst at Energyintel.
"The loss of critical gasoline flows... will stress markets over the next few weeks," he added.
The US Minerals Management Service estimated that 95% of the Gulf of Mexico's oil output was out of service following the hurricane, as well as more than 80% of natural gas production.
'Days of reckoning'
That has raised concerns among many analysts, who now see petrol prices increasing nationwide to beat previous records.
According to the AAA motor club, gasoline costs an average of $2.62 a gallon in the US, compared with $1.86 a year ago.
"On a national average, we could hit $3.25 at the pump easily, potentially even by this weekend," said Jason Schenker, an economist at Wachovia. "This is going to cut into consumer demand."
Mark Routt of Boston-based Energy Security Analysis said that his "rule of thumb is that the national average pump price will typically be 65 cents higher" than the market price.
"Most of that will get passed to consumers within three weeks," he added.
While it is true that the US economy is still motoring - it grew at an annual rate of 3.3% in the April to June quarter - the worry is that a significant dip in consumer demand would slam the brakes on the recovery.
"Depending on what we learn in the next few days, this may be the biggest oil-supply shock since the 1970s," said Daniel Yergin, an analyst at Cambridge Energy. "We are now in the days of reckoning."
http://news.bbc.co.uk/1/hi/business/4203414.stm
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Gas stations in and around downtown Atlanta had temporarily run out of gas. The same was reported elsewhere, including parts of North Carolina, West Virginia, Wisconsin and Arizona. Many retailers who did have gas had no clue when their next shipments would come in.
"People have kind of panicked and they're waiting in long lines because they're afraid the prices are going to go up," said Jan Vineyard, executive director of the West Virginia Oil Marketers And Grocers Association. "We're going to have some outages."
Price hikes were first evident at stations nationwide Wednesday as gasoline costs breached $3 a gallon for the first time in numerous states, the result of fuel pipeline shutdowns and delayed deliveries since Hurricane Katrina devastated Louisiana and Mississippi earlier this week.
"Everybody is panicking. They think there's not going to be any gas," said Keturah Jackson, a clerk at a gas station in Atlanta's upscale Buckhead district.
Price hikes were evident at stations nationwide Wednesday as gasoline costs breached $3 a gallon in numerous states, the result of fuel pipeline shutdowns and delayed deliveries since Hurricane Katrina devastated Louisiana and Mississippi earlier this week.
In Washington, the Bush administration decided to release crude oil from the federal petroleum reserves after Katrina knocked out 95 percent of the Gulf of Mexico's output. But because of the disruptions and damage to the refineries, gasoline prices seemed to pay no heed.
Gas prices jumped by more than 50 cents a gallon Wednesday in Ohio, 40 cents in Georgia and 30 cents in Maine. The increases followed price spikes on wholesale and futures markets Tuesday after the hurricane knocked off-line refineries and pipeline links along the Gulf Coast that provide about a third of the country's gasoline supplies.
Read More
http://www.cbsnews.com/stories/2005/09/01/katrina/main810903.shtml