Hurricane Ida's trip through Gulf of Mexico could push oil prices higher

It has been months since a hurricane posed a real threat to oil rigs in the Gulf of Mexico. Now, Hurricane Ida is entering the region from the west after doing significant damage in Nicaragua.

Most hurricanes that move into the Gulf end up doing very little damage to either deep sea drilling platforms or the refineries around Houston, but traders still get nervous about the potential interruption in oil supply. According to the Financial Times, the Gulf of Mexico accounts for almost 25% of U.S. oil production.

Oil prices have been hovering between $77 and just above $80 over the last month as experts try to decide whether the economies in the U.S., U.K., and E.U. are actually beginning to expand. The jobs report on Friday was so bad that oil fell over $2. Of course, the minute there's a sign of consumer or business demand in the U.S., crude will likely move up again. Trading experts and the federal government are forever arguing about how much of the movement in oil prices is based on supply and how much on speculation in the market.

If Ida does begin to threaten rigs and big oil companies have to pull their crews off for safety reasons, crude prices will move up again this week, at least for now.

Douglas A. McIntyre is an editor at 24/7 Wall St.