NEO nuenco nl

$$$$gas prices set to blow$$$$

  1. 288 Posts.
    Hurricane Katrina KO'ed roughly 10% of the US's oil refining and natural gas pipeline capacity.

    Emergency supplies of refined petroleum products are slated to be coming in from around the world. But it will be more than a week before shipments begin arriving. Until then inventories of gasoline and heating oil will remain tight.

    But it seems that natural gas might prove to be the biggest commodity casualty from Katrina.

    According to the US Minerals Management Service, more than 4 billion cubic feet a day (about 42%) of the region's natural gas production remained shutdown. Experts have said that since August 26th, 67.6 billion cubic feet of output has been lost.

    And this is troubling for utility company because this is the time of year when they typically increase their underground storage of natural gas to prepare for winter demand.

    As the summer driving season unwinds, and with winter still months away, home heating costs are already running sharply higher than a year ago. Adding to the mayhem, some weather forecasters are calling for a colder-than-normal winter, which means tight supplies and higher heating costs.

    Yesterday the Energy Information Administration reported that natural gas prices could increase as much as 71% in parts of the United States this autumn.

    And it's not just gas that the agency expects to increase. The bureau said natural gas prices will increase as much as 71% in the Midwest, heating oil prices could jump 31% in the Northeast, and electricity prices could increase 17% in the South.

    The agency reported that domestic oil production and gasoline refineries could return to pre-Katrina production, just under 5.4 million, by November if the resurrection comes swiftly. But that seems unlikely.

    Even after power is restored, restarting an oil refinery is a tricky and time-consuming process. Crews must meticulously conduct inspections, checking and rechecking for leaks. They must also ensure that all saltwater has been cleared or risk igniting a fire.

    Furthermore with the telecommunication infrastructure still down or overloaded, many companies have not been able to locate displaced employees.

    If they're lucky, normal operations will return the end of the year.

    Four of the 10 refineries that were shut down last week are said to be back running at full capacity sometime next week. But EIA Director Guy Caruso said that refineries that suffered severe damage could be out of commission for several months.

    The EIA expects about 900,000 barrels a day of US refining capacity to remain unavailable as long as the end of this month.

    So clean out the chimney and start chopping wood now. I'm going long timber. Go and do likewise, gents.
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