Oil, gas may soar as storm shuts U.S. Gulf production

The Louisiana Offshore Oil Port, which handles about 11 percent of U.S. imports, closed yesterday. Katrina is one of the most powerful storms ever to enter the Gulf, source of about 30 percent of U.S. oil production and 24 percent of the country’s natural gas.

“Forecasters are saying Katrina could do more energy damage than any storm in recent years,” said Jason Schenker an economist with Wachovia Corp. in Charlotte, North Carolina. “It’s not just that there’s going to be outages for the next couple of days. With shutdowns and damage at platforms and refineries, the bullish impact could be felt for the rest of the year.” 

“I think it is easily conceivable that we could see crude futures hit $70 this week,” Schenker said.

NPR just said that futures have already hit $71 on markets that are trading.