- Title: USA: OIL PRICES SURGE TO RECORD HEIGHTS
- Date: 29th August 2005
- Summary: (BN11) NEW YORK CITY, NEW YORK, UNITED STATES (AUGUST 29, 2005) (REUTERS) 1. VARIOUS OF NYMEX FLOOR AND OIL TRADERS (3 SHOTS) 0.17 2. MCU (English) FADEL GHEIT, OIL ANALYST AT OPPENHEIMER AND COMPANY SAYING: "It just makes a very bad situation even worse. We already got into this hurricane season with very low supply, stretched capacity, high demand and all of a sudden, you get, on the top of that, you get a hurricane of this magnitude. So obviously it was very bad for the consumer it was very bad for the economy and it's a very major challenge." 0.52 3. VARIOUS OF NYMEX FLOOR AND TRADERS (2 SHOTS) 1.07 4. MCU (English) FADEL GHEIT, OIL ANALYST AT OPPENHEIMER AND COMPANY SAYING "The immediate problem is supply disruption. The longer term problem is some of this production might not come back, or will come back in a very long period of time. So that will definitely stretch things out and we are getting into the home heating season. If we have colder than normal winter so we're really in deep trouble." 1.30 5. VARIOUS OF NYMEX FLOOR AND TRADERS (2 SHOTS) 1.46 Initials Script is copyright Reuters Limited. All rights reserved
- Embargoed: 13th September 2005 13:00
- Keywords:
- Location: NEW YORK MERCANTILE EXCHANGE, NEW YORK, UNITED STATES
- City:
- Country: USA
- Reuters ID: LVAA0MPRAAHTNNP6GOLVBQNAERDH
- Story Text: Oil prices surged to record heights as one of the
biggest hurricanes in U.S. history disrupted oil and gas
production in the Gulf of Mexico.
U.S. crude oil futures rose more than 2 U.S. dollars
(USD) on Monday (August 29, 2005) after surpassing a record 70
USD a barrel overnight as fearsome Hurricane Katrina
disrupted production in the Gulf of Mexico.
Crude for October delivery was up 2.02 at 68.15 USD
per barrel at 12:00 p.m. EDT (1600 GMT) on the New York
Mercantile Exchange. It set a record high of 70.80 in
overnight ACCESS trading, the first time a front-month
contract traded above 70 USD since NYMEX introduced crude
futures in 1983.
Fadel Gheit, an oil analyst for Oppenheimer and Company
in New York, said, "It just makes a very bad situation even
worse. We already got into this hurricane season with very
low supply, stretched capacity, high demand and all of a
sudden, you get, on the top of that, you get a hurricane of
this magnitude. So obviously it was very bad for the
consumer it was very bad for the economy and it's a very
major challenge," he said.
Hurricane Katrina was blowing 125 mile per hour (201
kph) winds after coming ashore on the coast of Louisiana.
The National Hurricane Center in Miami said the storm,
now a Category 3 on the five-step Saffir-Simpson scale, was
not quite the monster it had been in the open Gulf, but
still packed a powerful punch. At its strongest it was a
Category 5 with 175 mile per hour (280 kph) winds.
More than 718,000 barrels per day (bpd) of crude
production, or about half of U.S. output in the Gulf of
Mexico, was reported shut down due to the hurricane.
Gheit said, "The immediate problem is supply
disruption. The longer term problem is some of this
production might not come back, or will come back in a very
long period of time. So that will definitely stretch things
out and we are getting into the home heating season. If we
have colder than normal winter so we're really in deep
trouble," said Gheit.
Last year Hurricane Ivan disrupted output for months.
The Gulf of Mexico normally pumps about 1.5 million bpd
of U.S. crude, a quarter of domestic output.
refining capacity of 1.774 million barrels of crude oil had
shut down ahead of Katrina, operators said.
Gulf Coast refiners produce about 45 percent of U.S.
gasoline.
The Louisiana Offshore Oil Port halted all operations.
Democrat Sen. Charles Schumer of New York on Monday
asked the Bush administration to release oil from the U.S.
emergency stockpile to help ease higher prices spawned by
the hurricane.
"If there was ever a time for the Strategic Petroleum
Reserve to be tapped, it would be now," Schumer said in a
statement.
NYMEX September gasoline was up 13.56 cents at 2.0625
USD per gallon after peaking at 2.16.
September heating oil was up 7.44 cents at 1.911 USD a
gallon after hitting a contract high 2.0137.
OPEC's President Sheik Ahmad al-Fahd al-Sabah said that
he would propose the group raise both real oil output and
its output target by 500,000 bpd at its meeting in
September in an attempt to lower prices.
He said most of the extra oil would come from Saudi
Arabia, the only OPEC member with sizeable spare capacity.
OPEC had around one million bpd of spare capacity, he
said.
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