I post a lot of energy related concerns in the SF but everyone seems to be following the NOLA situation so I'll throw this out in GD too.
By Erwin Seba
HOUSTON (Reuters) - U.S. oil and natural gas supplies would be devastated if another strong storm hits while the Gulf of Mexico is recovering from Hurricane Katrina, energy analysts said on Wednesday.
"We certainly can't stand another storm," said Tom Bentz, vice president and senior energy analyst for BNP Paribas Commodity Futures Inc. "That's why people are watching the storms out there now."
Two hurricanes and a tropical storm were churning in the Atlantic Ocean on Wednesday. None of the current storms are forecast to enter the Gulf.
The 2005 hurricane season, which lasts until November 30, has been one of the most active on record and is just reaching the traditional peak of activity in early September.
"If we were to see another major storm, we could have damage on damage," said Tim Evans, senior oil market analyst for IFR Energy Services.
According to the U.S. Minerals Management Service, 57 percent, or 860,568 barrels, of daily crude oil production and 40.36 percent, or 4.0359 billion cubic feet, of daily natural gas output was shut by Katrina in the U.S. Gulf as of Wednesday.
Also, five refineries remain shut and five others are producing at reduced levels.
Shortages would probably result if a hurricane churned through offshore production areas and then came ashore west of Houston, with the most destructive northeastern quadrant of the storm passing over 14 refineries, two major ship channels and pipelines in east Texas and western Louisiana.
"Having one beneath Texas would be an unmitigated disaster," said Peter Beutel, president of Cameron Hanover.
A storm following in Katrina's wake to the Mississippi-Louisiana coast could finish off platforms and production facilities weakened last week.
A major storm in the Gulf would be expected to spike prices to at least the record levels seen last week, the analysts said.
"I don't see how anyone could approach it with any kind of rationality or logic left," Beutel said.
These analysts are useless. They do nothing but create scare and hype to up the prices of energy.
That was one of the 1st things I thought of... especially if another one hit while rescue and evacuation operations were still going on.
Hurricane season has barely started.