Sunday, August 28, 2005

Like the opening minutes of a disaster movie...

Watching the weather channel right now is like the opening moments of a disaster movie--setting the stage for what everyone will be talking about come Monday. Looks like hurricane Katrina, now a category 4 storm with room to intensify further, is headed right towards the jugular of U.S. oil production and importation: Port Fourchon and the Louisiana Offshore Oil Port. Read this article on their vulnerability to a hurricane!

Speaking of disaster movies, this is shaping up exactly like FX's "OilStorm" movie that came out a few weeks ago... hurricane destroys Port Fourchon and the LOOP, tension in the Middle East (e.g. Sunnis fees further alienated by Iraqi constitution), combine to drive oil prices sky high.

While Peak Oil and this kind of disruption are mostly unrelated, I feel like this type of disaster will help raise awareness that will transfer to Peak Oil, which would be a good thing. That said, I sincerely hope that this doesn't hit New Orleans, as the death toll could be very high--the big question this time next week may not be "Pain at the Pump", but whether there is criminal liability on the part of New Orleans emergency managers for waiting until half an hour ago to issue a mandatory evacuation...

Does make me feel a bit smug, though, about my "long shot" Dec'05 @$100/barrel crude oil call options. For what it's worth, I think that they're still a bit too far off the money.

Tune in Monday morning at www.321energy.com to watch the economic carnage. It's like a car accident on the other side of the freeway...

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