Oil rigs evacuated as Rita approaches

Well, here we go again...

"Oil companies in the southern United States are evacuating oil rigs in the Gulf of Mexico as Hurricane Rita bears down on them.

Some of the workers were still repairing damage from Hurricane Katrina, which destroyed forty-six oil platforms last month.

President Bush has been briefed on Hurricane Rita, which is gaining strength and is predicted to hit the coast of Texas in the next few days.

He says appropriate measures are being taken.

Hurricane Rita has already smashed through central and western Cuba, with intense wind and rain, prompting the evacuation of 230,000 people."

And then if that weren't the bad enough:

US refineries evacuate as Rita gains strength

"The US energy industry braced itself on Wednesday for another blow as Hurricane Rita swept towards the oil and gas production centre of the Gulf coast, which is still reeling from Hurricane Katrina.

Crude prices spiked higher on Wednesday morning after Hurricane Rita, currently tracking across the Florida Keys, was upgraded to category 3 with sustained winds in excess of 100mph. Nymex West Texas Intermediate for November delivery was up 97 cents to $67.17 a barrel, while November Brent climbed 73 cents to $64.93 a barrel.

Energy companies in the Gulf of Mexico, including BP Plc, ConocoPhillips, Exxon Mobil Corp., and Marathon Oil Corp., have evacuated staff and shut rigs and platforms in the path of Rita.

The National Hurricane Center predicted that Rita would probably develop into a Category 4 hurricane, with winds of at least 111 mph., when it hits land at the weekend. Hurricane Katrina grew to a Category 5 and delivered such a powerful blow that 5 per cent of US refining remains down, more than three weeks after the storm touched down in Louisiana.

While there is a chance this next hurricane could again hit Louisiana, forecasters believe it to be more likely to pummel Texas, which has 26 refineries, with capacity to produce 26 per cent of US crude oil." read more

And just in case it's not obvious why this is such bad news...

Oil Prices Leap As Rita Prompts Evacuations

"Concerns that Hurricane Rita could smash into key oil facilities in Texas lifted crude-oil prices more than $1 a barrel Wednesday as workers fled oil rigs in the Gulf of Mexico less than a month after Hurricane Katrina tore through the same region.

An offer by the Organization of Petroleum Exporting Countries to make available an extra 2 million barrels of oil a day did not seem to quell the market as the focus remained on the storm, which grew into a Category 4 hurricane Wednesday.

Prices could also rise further Wednesday after the U.S. Department of Energy's weekly petroleum inventories snapshot, which could show declining crude and heating oil stocks because of Hurricane Katrina.

Light, sweet crude for November delivery rose $1.40 to $67.60 a barrel in electronic trading on the New York Mercantile Exchange by afternoon in Europe. It was the first trading day that November was the front-month contract. October futures fell $1.16 to close at $66.23 a barrel in New York overnight.

On London's International Petroleum Exchange, November Brent crude oil futures gained $1.10 to $65.30 a barrel.

Prices are nearly 45 percent higher than a year ago. They reached an intraday record of $70.85 on Aug. 30 when Katrina made landfall, wreaking destruction on oil refineries and other facilities in Louisiana and surrounding areas.

Forecasters said Rita's winds have reached 135 mph as it churns toward landfall later this week on the Gulf Coast. That is now predicted for Saturday somewhere between northern Mexico and western Louisiana, most likely in Texas.

Texas, the heart of U.S. crude production, accounts for 25 percent of the nation's total oil output. Rita is also thwarting recovery efforts as refineries gear up for the Northern Hemisphere winter, the peak season for production of distillate fuels that include heating oil, jet fuel, kerosene and diesel.

Analysts said OPEC's move was not likely to have any impact on lowering prices in a time of high demand and tight supply." read more

For those keeping score, yesterday it cost me 45 dollars to fill up my car with Premium (which was all that was left) in South Miami. Something tells me we're headed for a world wide depression. Just a hunch really...