USA: Oil Production in Gulf of Mexico Falls By 1.5 Mil Barrels/D Owing to Hurricane Katrina

USA: The oil production in the Gulf of Mexico has fallen by 1.5 mil barrels/d owing to hurricane Katrina. The quantity accounts for roughly 25% of the total oil output in the USA or 2% of the global production. Oil from the Gulf of Mexico is very precious because it contains very little sulfur and is easy to process. Even if the hurricane subsided immediately, it will be impossible for miners to restart working in full output sooner than in two months. This means that the oil price is sure not to drop significantly from the current level around USD 70/barrel. The fact that Opec has promised to propose a production raise by 0.5 mil barrels/d at its meeting in Sep 2005 can hardly have any influence on the price.