US crude futures eases after topping $70 on US Gulf hurricane

Singapore (Platts)--29Aug2005

Benchmark US light sweet crude futures pulled back to levels just over
$69/bbl in late Asian afternoon trading Monday after being pushed to a record
high trade of $70.80/bbl Sunday as the "potentially catastrophic" Hurricane
Katrina shut in production and refining facilities in the US Gulf of Mexico.
     The New York Mercantile Exchange's October West Texas Intermediate crude
contract changed hands at $69.14/bbl at 0813 GMT Monday, a good $1.66 below
the historic high trade notched at 2305 GMT Sunday, but still $3.01/bbl above
Friday's close on NYMEX.
     The North Sea benchmark Brent crude on London's International Petroleum
Exchange was not trading, on account of a bank holiday in the UK Monday. 
      As Category Five hurricane Katrina gathered strength in the US Gulf over
the weekend, oil companies began evacuating offshore staff and shutting in
crude and natural gas production as well as refining and certain pipeline
transport operations, which sparked a buying frenzy on the NYMEX energy
futures. 
     As a result, NYMEX WTI surged past the $70/bbl psychological barrier for
the first time since the launch of the contract in 1983, hitting an all-time
high on Access of $70.80/bbl. Front-month unleaded gasoline soared 20.31cts to
an all-time high of $2.13/gal and front-month heating oil jumped 16.84cts to a
record $2.005/gal.
     The hurricane was downgraded a notch to Category Four early Monday, but
with winds reaching 248 km/hour (155 miles/hour), still held the potential to
cause extensive damage in the coastal areas of Louisiana, Mississippi, Alabama
and Florida.

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