Say hello to Dolly

[kay9_medic]

Strengthening very well

[Cobra]

looks like gas will rise again

[shinobi]

That's a given!

[kay9_medic]

"looks like gas will rise again"

Yeah, even though it's not that much of an oil event, and more a nat gas and infrastructure event.

Oilpatch Braces for Year's First Storm (http://www.reuters.com/article/marketsNews/idUSN2142079120080721?rpc=401&)

"HOUSTON (Reuters) - Offshore oil producers in the Gulf of Mexico on Monday geared up to prepare for the first big storm of 2008, but Tropical Storm Dolly looked unlikely to deal a crippling blow to U.S. crude oil and natural gas production."

"However, oil markets reacted nervously to news that Shell Oil Co had began flying workers from platforms in the western Gulf of Mexico. U.S. crude oil futures rose $3 to over $132 a barrel earlier on Monday, and were up $1.53 at $130.41 a barrel by 2:10 p.m. EDT (1810 GMT)."

The real damage will be in tanker traffic delay. Inventories have already trending lower in the Gulf and are near record historic lows over all, see graphs below.

[kay9_medic]

And Tropical Storm Edouard. Although few forecast it to be a hurricane at this point, none of the models are at high levels of confidence. Edouard's track is going right through oil and gas rig alley.

These gulf storms have my attention, because historical lows on GOM crude inventory stock means one large storm or several small evacuations of oil crews will make a crisis.

Inventories are at the bottom of the historical trading range (blue band). Below the blue band somewhere is the minimum operating levels; the oil or gasoline or diesel inventory in a pipeline that cannot be used. When or if we reach minimum operating levels, the product will be unavailable to the refineries and distribution nodes at the remotest ends of the pipelines. The end result of MOL is paper bags over gas pumps.

The distribution chain is really long and complex. I'm surprised that snags have not been more common.