By Johnny Jackson
Some 1.9 million residents evacuated the Gulf Coast before Hurricane Gustav made landfall, and nearly 1.2 million were left without power in Louisiana and Mississippi, following the storm's impact on Monday.
But the price of oil is the lowest it has been in a while, and industry officials say the downward turn could continue. "This is good news, because it reflects the fact that Gustav did not bring any significant damage to oil platforms and refineries in the Gulf," said Gregg Laskoski, spokesman for AAA Auto Club South. "We really dodged a bullet in the direction that Gustav took."
On Monday, the Minerals Management Service reported that 100 percent of the Gulf's crude oil production (about 1.3 million barrels of oil a day) had been shut down along with about 95 percent of the Gulf's natural gas production. About 87 percent of the Gulf's 717 manned platforms were also evacuated.
Most of the 32 refineries along the Gulf Coast have temporarily shutdown or reduced their output, including 14 refiners with a total capacity of 2.7 million barrels per day. Nine refineries, mostly in Texas, have reduced runs by a total of 3.1 million barrels per day.
The facilities will probably be up and running again in a few days, said Laskoski, who added that a major impact on the fuel price is more so on the demand side than the supply side.
Crude oil prices dipped drastically Monday from $115.46 per barrel to $111.16, and closed on Tuesday at below $110 per barrel on The New York Mercantile Exchange. It left the average regular, unleaded gas price at about $3.68 per gallon nationally, the same as Monday and 20 cents below the average a month ago.
"We're very optimistic that we're going to see gas prices go down," he said. "One reason is that it is the end of Labor Day travel. Also, right now, the dollar is in a stronger position against both the Euro and the British pound. It's reasonable to think that we can get down to $3 a gallon."
Metro Atlantans are currently paying an average of $3.58 per gallon for regular unleaded gas, which is among the lowest prices in the state.
Refinery companies are currently in the process of making damage assessments, which should be complete in the coming days.
Gustav, now no more than a tropical depression, is headed inland toward Texas. The storm, however, is only the most recent in a line of tropical storms developing in the Atlantic, including hurricanes Hanna, Ike, and Josphine, the 10th named storm of the Hurricane Season.
Hurricane Hanna is likely to make landfall near Charleston, S.C., on Friday. Precipitation in metro Atlanta will depend on the path of the approaching storm, said Brian Lynn, National Weather Service meteorologist. "[Tropical Storm] Fay put a significant dent in the drought," Lynn said. "If Hanna goes into Charleston, probably the main effect is going to be some wind. The best precipitation is going to be along the South Carolina border."
Area residents should expect temperatures to be in the upper 80s for the remainder of the week, with mostly sunny skies.
With fewer refineries and oil platforms along the southeastern coast, officials do not anticipate any immediate, ill-effects from Hanna on the oil futures market.