Hurricane Rita and $5 Gas
Hurricane Rita may cause gas prices to spike above $5 a gallon, according to some experts.
– Remember when gas spiked to $3-plus a gallon after Hurricane Katrina? By this time next week, that could seem like the good old days. Weather and energy experts say that as bad as Hurricane Katrina hit the nation’s supply of gasoline, Hurricane Rita could be worse. Katrina damage was focused on offshore oil platforms and ports. Now the greater risk is to oil-refinery capacity, especially if Rita slams into Houston, Galveston and Port Arthur, Texas. “We could be looking at gasoline lines and $4 gas, maybe even $5 gas, if this thing does the worst it could do,” said energy analyst Peter Beutel of Cameron Hanover. “This storm is in the wrong place. And it’s absolutely at the wrong time,” said Beutel.
Michael Schlacter, chief meteorologist for private weather service Weather 2000, said that it now appears the eye of Rita could come ashore near Port Arthur, Texas, near the Texas-Louisiana border, early Saturday. The forecast from the National Hurricane Center puts the most likely track of the storm a bit further west, coming ashore in near Galveston, Texas. Both areas have big concentrations of refineries. Schlacter warned that Rita is now so large that refineries in both areas would be affected by Rita making landfall at either location. And he said it’s a fair bet that Rita will be even stronger than Hurricane Katrina was when it hit most of the oil facilities in Louisiana and Mississippi. “It’s splitting hairs as to where the eye is coming ashore,” he said. “Anywhere within 60 miles of the eye will get clobbered.”
Offshore oil rigs and platforms, even some of them further east off the Louisiana Gulf Coast, are also at risk from the heavy surf being kicked up by the storm as it moves through the Gulf of Mexico. “She is spending the longest possible time she could spend in the Gulf, and because of that she has days and days to build up momentum and churn up the waters,” he said.
Lovely. One obvious lesson from this mess is that concentrating most of our refining and distribution capacity in one region makes little sense.