GOVERNMENT LATEST ON KATRINA ENERGY CRISIS

The EIA has released its Daily Report on the Katrina impact on the nation’s oil and gas markets.

http://tonto.eia.doe.gov/oog/special/eia1_katrina.html

Highlights of the report include:

-- 60.12 percent of Gulf crude production out of action (as of Sept. 7th)
-- 40.2 percent of Gulf gas production is out of action (as of Sept. 7th)
-- Gasoline futures prices are mixed and up slightly at 203.8cents per gallon. (up 1.6 cents)
-- West Texas Intermediate Crude prices at $64.49pb

-- Six refineries are shut down, 2 of which should be up and running by weeks end.
-- Four remaining refineries (= 5% of US refining capacity) will be shut down for an extended period
-- Average retail price of gasoline in US $3.07 up 45.9cents.
-- Average retail price of diesel is $2.90 up 30.8 cents.
-- US crude oil inventories remain well above seasonal average levels
-- Total commercial petroleum inventories dropped 14.9 million barrels yet still remain above average for this time of year.
-- The Capline Pipeline transporting East Coast crude is operating at 90%.
-- LOOP (Louisiana Offshore Oil Port) is operating at 75% capacity. LOOP represents more than 10% of US imported oil
-- Gas pipeline damage has been reported on a number of regional lines by two companies.

This Week In Petroleum, the EIA energy oil report was released Sept 8th highlighting the effects of last weeks Katrina disaster. It is available at:

http://tonto.eia.doe.gov/oog/info/twip/twip.asp

-- Highlights of the report include:
-- Average gasoline price just 5 cents shy of 1981 record high
-- Average gasoline prices expected to stay well above 2$ a gallon for foreseeable future
-- Over 25% of US crude production affected by Katrina
-- Between 10 and 15% refining capacity shut down in first few days after Katrina
-- Two East Coast Gasoline pipelines shut down for first few days after Katrina, now operational.
-- Capline oil pipeline shutdown initially caused oil shortages at Midwest refineries.
-- The combination of two above helped to cause gasoline price spikes
-- Retail Gasoline Prices expected to REMAIN VERY HIGH in next few weeks
-- Gulf crude production likely to be low for many months to come
-- Gasoline imports from EU likely to arrive in two weeks and reduce average US prices
-- Higher imports of crude and release of Strategic Petroleum Reserve oil will over satisfy refinery needs

The DEPARTMENT OF ENERGY

A Daily Update on the energy crisis resulting from the Katrina disaster is listed on the DOE website. A list of all current DOE activities to restore oil supplies to refineries and refinery fuel distribution status is provided. This includes:

-- the release of oil from the Strategic Petroleum Reserve
-- the status of refining capacity of the affected refineries
-- the OK by the Environmental Protection Agency to use “winter blends” of fuel in energy needy areas
-- the waiver of the Jones Act for transport of fuels and cargos in the affected areas
-- the offer of fuel and oil supplies from the International Energy Agency to the United States.

Please visit the DOE site and review the daily updates on the nations energy crisis after the Katrina disaster.
http://www.doe.gov/engine/content.do?PUBLIC_ID=14135&BT_CODE=DOEHOME&TT_CODE=GENERICDOCUMENT