The Wall Street Journal finds a lot of concern in the energy sector:
Royal Dutch Shell PLC became the first of what could soon be many producers to announce that it would halt some production ahead of the storm. Anadarko Petroleum Corp. said it will evacuate all offshore employees by Sunday, including the key natural gas production platform the Independence Hub, which produces 800 to 850 million cubic feet of natural gas per day.
…The storm’s projected course takes it through the heart of U.S. offshore energy production, threatening about 25% of domestic oil and 10% of gas output. About 40% of U.S. refining capacity is located along the Gulf Coast, with the bulk of activity occurring between Houston and New Orleans.
The industry is fearing the worst with Gustav:
Government and private forecasters believe Gustav is most likely to make landfall in Louisiana. Gustav’s current track would leave southern Louisiana exposed to the “dirty,” or stronger side of the storm, potentially leaving New Orleans vulnerable to the sort of severe flooding that devastated the city after Katrina hit in 2005. That storm was a Category 3 when it reached land, and New Orleans was exposed to minimal hurricane-force winds.
“That’s why it’s so critical looking at Gustav, if you have a major hurricane go inland it could be a lot worse than Katrina was in the city,” said Mark Chambers, a meteorologist with ImpactWeather, a Houston-based forecasting service that provides weather reports to many energy companies.
Preparations are already underway to mitigate a disruption in oil supplies – better safe than sorry:
The U.S. Department of Energy said Thursday it was ready to tap the nation’s Strategic Petroleum Reserve in the event Gustav caused a severe production disruption, echoing earlier comments from the IEA. We always stand ready to bring additional relief to the market, if it’s necessary,” Aad van Bohemen, head of the emergency planning and preparation division at the IEA, told Reuters.
Look for gas prices to rise, even if only temporarily, again.
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