Crude Rises, threat of Hurricane Gustav to Gulf Facilities Drives Market
Posted on: Aug 27th, 2008 | By Doug Casey | Filed under Financial News, Oil Investment & Alternative Energy
In the energy market Tuesday, crude for October delivery moved higher, closing at $116.27/barrel, up $1.16. October reformulated gasoline added 8.7 cents, to $2.9697/gallon.
Traders were mostly watching Hurricane Gustav, which has the potential to affect energy interests in the Gulf of Mexico as a major hurricane, according to AccuWeather.com.
“The longer Gustav stays over the warm water in the Caribbean, the stronger it gets and the greater the chance that it will become a Category 3 hurricane by Saturday,” said John Kocet, a meteorologist at AccuWeather.
Worse, “it could intensify to Category 4 or 5 strength over the warm water in the Gulf,” AccuWeathersaid, making it potentially “ the first major hurricane [Category 3 or greater] in the Gulf since Hurricane Wilma … in October 2005.”
But Edward Meir, of MF Global, reminds us that, “for all the hand-wringing that this storm may cause, we should remember that the price sell-offs following storm systems that have failed have usually far outpaced the initial run higher.”
Source: Crude Rises, threat of Hurricane Gustav to Gulf Facilities Drives Market
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