Absence of an ill wind blows some good

GLOBAL warming’s failure so far to produce a repeat of last year’s serial hurricane assault and battery of the oil-rich Gulf of Mexico is the swing factor in the suddenly soft price of oil.

A year ago today, New Orleans was inundated by floodwater, and oil refineries on the Gulf coast and rigs and platforms offshore were shut and damaged after the assault of hurricane Katrina, one of a record 15 hurricanes and 28 named storms that year in the Atlantic Basin. There were four highest-level category 5 hurricanes in the Atlantic Basin in 2005

Oil supplies were already stretched by strong global demand when the Atlantic hurricanes began to roar in 2005, and the oil price soared as they multiplied. Between mid-July and the end of August, the price of West Texas Intermediate crude leapt from $US54.93 a barrel to $US69.81 a barrel. It fell in September as OPEC nations stepped up production in response to shutdowns in the Gulf, and the hurricane-assisted price of late August was not reached again until April this year, when Nigerian oil supplies faltered and tensions about Iran and the Middle East grew. The oil price peak of just over $US77 occurred in July, as concerns about Iran’s nuclear plans and the West’s response mounted, and as America’s hurricane season began.

Oil is still historically high today, but it is 10 per cent lower, at $US69.85, and climatic calm is a key reason.

The Age (Australia)