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Hoarding is exactly what the government is doing right now by filling the SPR, and frankly it's the best thing that could happen. It drives prices up. High prices encourage demand destruction. They also finance new well development. The hoarded oil gives us a buffer to fall back on once shortages become more prevalent. High prices are what we need in order to adapt to what's coming, and the sooner they happen, the better.

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Oil: A Bird's Eye View of Rita's Fury
Production; Extraction; ExplorationA helicopter ride reveals partly flooded refineries, smashed ships, and blocked waterways. The industry's recovery will take a great deal of time

Seeing is believing. The Coast Guard invited Platts on a reconnaissance helicopter this week to observe the damage from Hurricane Rita, which came onshore Sept. 24 as a Category 3 hurricane near the Texas/Louisiana border.

From this four-hour flight, two stark realities emerged: The recovery of energy and shipping infrastructure from Beaumont/Port Arthur to southeastern Louisiana will take a great deal of time, and the Houston/Galveston area dodged a bullet.

The flight left U.S. Coast Guard Air Station Houston at Ellington Field and headed east from the Houston area to the Port of Beaumont. Along the way, the damage to trees and houses seemed to increase as we got closer to Rita's actual path last weekend. Even in Galveston Bay, a warehouse at a container-ship dock suffered some roof damage due to Rita.

PRIVATE VESSELS SMASHED. The visible damage to electricity transmission lines also worsened as the helicopter continued east, a sign that bringing power back to these affected regions will take some time, slowing the recovery process for oil, gas, and petrochemical infrastructure in the Beaumont/Port Arthur area.

Platt's Oilgram News

Posted on Friday, September 30 @ 12:48:16 PDT by Leanan
 
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Re: Oil: A Bird (Score: 1)
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