Hurricane Ida's trip through Gulf of Mexico could push oil prices higher
Filed under: Energy
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.
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.
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Reader Comments (Page 1 of 1)
11-08-2009 @ 10:28AM
$5 gas, here we come said...
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11-08-2009 @ 2:23PM
MikeW said...
The economy will bounce back. And those thinking about long-term recovery, know the enviroment will be a big winner in the conversion to biofuels & biopower -- saw a cool site; Balkingpoints ; incredible satellite view of earth
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11-08-2009 @ 5:20PM
pistolpetect9 said...
Wtf cares already. It's all sickening. Just make Gas and Oil higher than it already is and see how the Economy fairs.
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11-08-2009 @ 8:29PM
Jesse said...
Well , Here we go again . Corruption/greed at its best . We already have surplus storage of crude oil ,and the hedge fund traders will figure out again how to raise the cost per barrel on speculation . These people must being praying for a storm somewhere.
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11-08-2009 @ 10:05PM
banzaigtv said...
National Hurricane Center, please extend the hurricane season through February due to continued summer weather in October and the fact that stupid people are letting their guards down after only two hurricanes through October. All the needed ingredients are now coming together for a much-expected-since-March oil shock late in the year. LOL
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