Wednesday, August 31, 2005

Ray of hope for Californians post-Katrina?

As the damage from Hurricane Katrina mounts, the price of oil continues to rise.

Reports of damaged and missing oil rigs in Hurricane Katrina's wake pushed energy prices to record heights Tuesday, while analysts warned that refinery closures along the flooded Gulf Coast could soon drive gasoline costs above $3 per gallon nationwide.

As oil companies began sending survey teams to their battered offshore platforms, crude oil future contracts for October delivery jumped $2.61 to close at $69.81. Wholesale gasoline futures soared 41 cents per gallon, hitting $2.48.

News trickling out of the gulf gave reason for both optimism and despair. Some facilities -- including a massive offshore oil port -- avoided catastrophic damage. Others may have been wrecked
Californians, however, may be spared by what is normally the biggest enemy of gas prices in our state--California refineries' special blends. The gas used in California is used only in California and is produced by refineries in the Golden State. This could spare consumers here the price shocks that will be felt in the Gulf States resulting from refining capacity going off-line in the Hurricane's wake--could.