According to U.S. Department of the Interior's Minerals Management Service, 95.8% of crude oil production and 91.6% of natural gas production in the Gulf of Mexico remains shutdown due to the damage caused by Hurricane Gustav. Most oil companies are returning crews to their platforms to complete safety checks before resuming production of oil and natural gas. However, the main problem facing oil companies are the power disruptions that have affected 55% of Louisiana. Without reliable electricity, production companies will not be able to fully resume production. Thirteen of the thirty-two GulfCoast refineries remain shut down, and as a result of this, there is a 5.6 million barrel per day reduction in gasoline production. In response to the gasoline shortage, refinery company Citgo requested a release of 250,000 barrels from the nations Strategic Petroleum Reserve, which was approved.The oil market on the other hand did not show much concern when oil only fell $1 Wed. Aug 27th to nearly $6 on Tuesday Sept. 2nd.Energy analyst compared the concern from 2005 when demand was higher to now not being much of an issue.Demand is 1.2million barrels/day less today than a year ago and oil prices are almost two times higher than when Katrina and Rita hit.The supply today seems to be enough to make it through even with the immediate shortage.
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