More than one million people were under evacuation orders yesterday as Hurricane Rita bore down on the central Texas coast- the heart of the US oil industry, threatening to make land and be one of the most powerful storms to hit the US. Prices are being driven directly by the projected path of the storm. Forecasters said Rita's winds have reached 225 km/hr, as the latest forecast predicted the center of Rita to make landfall near Galveston, Texas, late Friday or early Saturday. 134 production rigs and 24 refineries lie in the possible path of Rita.
Crude oil prices rose in anticipation of yet another hurricane led disaster, as Hurricane Rita gathered speed and appeared to head for Texas. Light, sweet crude for November delivery rose to US$66.80 a barrel on the New York Mercantile Exchange, heating oil jumped nearly three cents to US$2.0387 a gallon, while gasoline touched US$ $2.0531 a gallon. On London's International Petroleum Exchange, November Brent crude oil futures rose to US$64.73 a barrel.
As per the U.S. Department of Energy, U.S. gasoline inventories rose 3.4 million barrels to 195.4 million barrels in the week ended Sept. 16, still more than 5% below year-ago levels. Inventories of distillate fuels, which include heating oil, rose 800,000 barrels to 134.1 million, more than 5% above year-ago levels. Crude inventories dropped 300,000 barrels to 308.1 million, but are nearly 12% above year-ago levels.
In Houston, America's oil and petrochemicals capital and its fourth largest city, people have been urged to leave low-lying areas vulnerable to the expected storm surge, and schools and businesses have been advised to close for two days. As of yesterday, Rita had forced oil companies to evacuate 15 rigs, cutting daily output from the Gulf of Mexico by 877,000 bpd- about 4% of US daily consumption.
22-Sep-05 
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