Breaking News: Oil Prices Drop As Hurricane Rita Weakens

[gatorcane]

From Yahoo news:

BUDAPEST, Hungary - Crude oil prices fell Friday for a second consecutive day and gasoline futures prices slipped as traders gauged news that Hurricane Rita had weakened, implying that damaged to refinery capacity in the Gulf could be less severe than originally feared.

http://news.yahoo.com/s/ap/20050923/ap_ ... NlYwM3MTY-

Finally some good news !

[wxwatcher2]

The storm hasn't even hit yet and they can play with prices this way.

It's all a big game and our dollars are the victims.

[Brent]

Oh yeah... 140 mph will cause "much less" impact.

[gatorcane]

I wondered why the prices are falling when she weakens just one category. As Max Mayfield says the difference
in intensity is the difference in getting hit by a freight train vs. a semi - which isn't saying much. These price
fluctations clearly underscore the volatility and sensitivity of U.S markets.

[beenthru6]

That's strange, as I just heard Rita could very likely strengthen again before landfall and that they think the weakening phase is over. I believe that was from Fox news (I have been switching back and forth between several ongoing news stations)

[no advance]

All we got to do is cut back and the prices will moderate. Unfornately not everyone will. It is unAmerican.

[aquaholic901]

All we got to do is cut back and the prices will moderate. Unfornately not everyone will. It is unAmerican.

Couldn't agree more.

[The Big Dog]

I wondered why the prices are falling when she weakens just one category. As Max Mayfield says the difference
in intensity is the difference in getting hit by a freight train vs. a semi - which isn't saying much. These price
fluctations clearly underscore the volatility and sensitivity of U.S markets.

All they hear is "weakening" -- that's why. They probably equate it with "dissapating." They're commodities traders, not meteorologists.

That said, I topped off yesterday. Probably should have waited until tomorrow, though. Gas stations won't raise their prices until after the storm goes through. If they do it before, it's gouging. If they do it after, it's "supply and demand," whether it is or not.

[FloridaHawk82]

I'm just a hack, but couldn't this be due to the updated forecast track placing Galveston Bay West of center. When they incresed prices (stupid) they were looking at more potential of Galveston Bay taking a NE quadrant hit, which could be devastating for the abundance of refineries there, both in wind damage and surge?? Just a thought.

Also, Big Dog, I agree with you... supply and demand seems to go out the window. Even here in Iowa, prices have went up 20 cents in the past 36 hours... that always irks me, as their tanks are full of the cheaper priced gas from days ago... they just pad their profits with the excuse that "crude oil prices increased today", like I'm supposed to believe that they got the higher priced crude oil (that increased in price TODAY) refined, stored, pumped into trucks, driven to Iowa, and delivered in the last 4 hours....

FWIW, I've been riding my bike to work everyday since Katrina, rain or shine... saves a little money (12 mile roundtrip) and just doing my little part to help!

[gtalum]

The storm hasn't even hit yet and they can play with prices this way.

It's all a big game and our dollars are the victims.

It's called "speculation". It happens with all commodities.

As was mentioned below, all we have to do is cut back on usage and the prices will drop to some extent.

[cjrciadt]

I'm more concerned by Unleaded Gas prices.

[PBGator]

I'm more concerned by Unleaded Gas prices.

That will spike also probably around 4 bucks a gallon and then as Galveston and Houston gets back to normal the next few weeks the prices will drop. Watching CNBC they had some petroleum expert on and he said he is being the contrarian, but once the oil infrastrure is back to normal, he expected after the first of the year the prices of crude will drop to 40-45 per barrel which translates to 2.00 bucks a gallon. We have oil exports piling up in tankers that can't offload for refining and that in itself will make the market settle down. Also like the .com craze in 2000 many investors think the oil market has peaked and are taking profits. Watch the big hedge funds and see what they do.

[gtalum]

Also like the .com craze in 2000 many investors think the oil market has peaked and are taking profits. Watch the big hedge funds and see what they do.

I've been thinking that now is an excellent time to sell my oil stocks, while everyone else is buying. No need to be greedy!