Oil and Gas update

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CNN Money Reports

NEW YORK (Reuters) - Oil prices tumbled Wednesday after the United States offered to loan crude oil to replace output lost when Hurricane Katrina ripped through the Gulf of Mexico.
But Washington’s gesture failed to address the country’s gasoline shortage. And energy experts, warning of a supply shock on the scale of the 1970s, [...]

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CNN Money Reports

NEW YORK (Reuters) - Oil prices tumbled Wednesday after the United States offered to loan crude oil to replace output lost when Hurricane Katrina ripped through the Gulf of Mexico.

But Washington’s gesture failed to address the country’s gasoline shortage. And energy experts, warning of a supply shock on the scale of the 1970s, said a two-year bull run that took oil to $70.85 on Tuesday may not have run its course. Indeed, gasoline futures continued to climb rapidly in Wednesday trading.

Barclays Capital estimates between 20 million to 40 million barrels of refinery throughput could be lost, with 14 million to 28 million barrels of gasoline affected.

“Oil products that were looking in ample supply, (e.g. heating oil), will tighten significantly, and those that were already tight, (and most especially gasoline), face further severe upwards price pressure,” the Barclays report said.

Meanwhile U.S. gasoline futures set a record high at $2.90 per gallon on Wednesday, after Hurricane Katrina shuttered several refineries on the Gulf Coast. September gasoline soared 42.55 cents to trade at $2.90 per gallon on the New York Mercantile Exchange.

Louisiana tops out right now at around $2.80 a gallon and the lowest gas prices in town are roughly $2.36 as reported by LouisianaGasPrices.com.