Posted on 09/01/2005 3:31:34 AM PDT by Flavius
by Leah McGrath Goodman FWN Financial News Wednesday, August 31, 2005
NEW YORK, Aug 31, 2005 (Dow Jones Commodities News via Comtex)
Crude oil futures dropped more than $2 and sky-high gasoline gains eased ahead of Wednesday's close, as a key oil port in the U.S. Gulf regained power following Hurricane Katrina and the government hinted the storm may hurt refineries more than oil production.
Benchmark light, sweet crude futures for October fell as much as $2.01 to $67.80 a barrel on the New York Mercantile Exchange, after touching $70.65 earlier. On London's International Petroleum Exchange, Brent blend crude futures for October shed as much as $1.93 to $65.64/bbl.
Scorching gains in Nymex gasoline futures for September, which expire Wednesday, shrank about 75% from earlier gains to last trade up 12.55 cents at $2.60 a gallon. Earlier, the contract rose as much as 45.05 cents to a record high of $2.9250 a gallon.
Prices slid as the Louisiana Offshore Oil Port regained power in St. James, La., and was in the process of starting an oil delivery to Exxon Mobil Corp.'s (XOM) refinery in Baton Rouge, La., in the heart of the refining region struck Monday by Katrina.
Katrina blew ashore Monday near New Orleans, threatening a cluster of U.S. refineries, pipelines and petroleum-production rigs in the Gulf of Mexico.
Despite a continuing power outage at Clovelly, La., the middle point between LOOP's offshore marine terminal, where foreign crude oil tankers offload, and the St. James hub, where the Capline pipeline picks up the crude and takes it to U.S. refineries, crude oil deliveries can be made out from storage tanks at St. James, said Mark Bugg, LOOP's scheduling manager.
Like LOOP, Capline pipeline - operated by Royal Dutch Shell PLC (RDSB.LN) and shut since Sunday due to power outages - also has regained power at the St. James hub, Bugg said.
Separately, the federal Energy Information Administration said Wednesday that Katrina appeared to hurt U.S. refineries more than oil production, noting lower oil prices and ballooning spot gasoline prices.
"Unlike Hurricane Ivan, which was a major hurricane that affected oil facilities last September and had a more lasting impact on crude oil production in the Gulf of Mexico, it appears that Hurricane Katrina may have a more lasting impact on refinery production and the distribution system," said the EIA, the statistics brach of the U.S. Department of Energy.
Weakening oil prices and gasoline gains shouldn't lull energy markets into a false sense of security however, said Scott Meyers, a senior trading analyst for brokerage Pioneer Futures Inc. in New York. Especially since Gulf refineries still haven't had a chance yet to fully assess storm-related damage.
"Things are maybe a touch better three hours ago," he said. "But this is only temporary relief. I think our refinery capacity is defunct at best, so gasoline prices will probably continue to rise."
Even so, the expiration of September gasoline futures may lead to sharp price swerves at Wednesday's settlement, Meyers warned. Trading remained extremely volatile, he said.
"You just don't know what's going to happen at the end of the day, it's that dangerous as a market right now," he said. "This last half hour is going to be vicious."
Bump
Hi, Peach-- this has got to help. Maybe the easily-flustered will settled down- I sure hope so.
I called a local gas station connected to our grocery store yesterday to see why they closed. They were out of gas because people were topping off based on rumors and fears. I think people are over-reacting, but what do I know about gas pipelines. LOL
Interesting chart- Hi & Lo are self-explanatory, MA is Moving Average?
Printing this now to shove it in his face....teehee.
prisoner6
Above is an example of bollinger bands, the price of the stock is banded by an upper and lower band along with a 20-day simple moving average.
Investopedia Says... Because standard deviation is a measure of volatility, Bollinger Bands adjust themselves to the market conditions. When the markets become more volatile the bands widen (move further away from the average), and, during less volatile periods, the bands contract (move closer to the average).
This is among one of the most popular technical analysis techniques. The closer the prices move to the upper band, the more overbought the market, and the closer the prices move to the lower band, the more oversold the market.
It was crazy here yesterday-- I went out in the morning to shop and do the Mother in Law daily check-- gas was $2.59 a gallon, no lines.
Go out for Chinese at six- pandemonium! Lines to every station, standing room only at the pump islands, cars broken down everywhere. Shades of the Road Warrior!
All the gas stations lacked was barbarians on motorcycles circling and shooting...
Thanks- that's extremely interesting. Used to use the technician approach to selecting stocks.
That's one reason I'm staying home today -- people are panicking because the local media keeps showing long lines of people waiting for gas. Fistfights are breaking out, and even shootings. Now they have to have police guarding the few stations that have gas. If the power could be restored, I think there will be plenty of gas, but so many pumps here are not working because of no electricity. I burned about a quarter tank waiting in gas lines yesterday, and now I don't have enough to drive to work or to the grocery store. I'm just so thankful to have power restored, I don't care if there's no food. Fortunately, my husband and I could each stand to lose a few pounds anyway.
You have a wonderful attitude about it all, Polly.
How can I have any other kind of attitude? I am so blessed. I personally know several hundred people from New Orleans and the Gulf Coast who have lost everything but their lives. I almost feel guilty that I still have my house and all my "stuff". If I had some gas, I'd drive to one of the shelters and try to help. Eventually, I know that there will be something I can do to help my less fortunate friends and co-workers from New Orleans. I've just got to be patient. It's so wonderful to be back on Free Republic and to have cable tv again. You don't realize how much you miss them until you don't have them for awhile.
It also appears that at least some of the refineries will be able to get up and running soon. The good news is that Exxon's Baton Rouge facility appears to have been undamaged, and production has been restarted. That one has a capacity of nearly 500,000 barrels/day. Two more (Motiva's Convent, LA facility and Valero's in St. Charles) are reporting minimal damage and in Valero's case, believe they'll be operational within two weeks. Those three refineries alone account for around 900,000 barrels of production daily.
If anyone is interested, here is the EIA's list of US refineries:
http://www.eia.doe.gov/neic/rankings/refineries.htm
Polly, I'm so glad you didn't lose your house and are okay. Stay safe as I worry that as NO becomes more untenable the looters will move to other areas to continue their rampage.
Thanks- link's copied & saved.
I filled both vehicles on Sunday based on (correct) FR speculation that oil and gas supplies would be disrupted to some degree by Katrina
They're all in New Orleans at the moment. I want to see them dealt with firmly so thugs in other areas get any ideas.
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