Hurricane Gustav Set to Threaten Energy Interests in GOM

NEW YORK (Dow Jones Newswires), August 26, 2008

Hurricane Gustav is almost certain to reach the Gulf of Mexico within days, posing a serious threat to U.S. energy infrastructure, meteorologists said Tuesday.

"It's not a matter of if it will enter the Gulf, but when and where," said Thomas Downs, a meteorologist with Weather 2000, Inc., a New York-based private forecaster.

Hurricane models have reached a consensus about Gustav's general path, but it remains unclear exactly which part of the Gulf the storm will traverse and how intense it will become as it nears oil and gas platforms. Gustav's sustained wind speeds in the Gulf could range from 115 miles per hour, making the storm a Category 3 hurricane, up to 180 mph, or a Category 5 hurricane, said Aaron Studwell, a senior meteorologist with Houston-based forecaster Weather Insight, L.P.

Category 5 is the highest level on the Saffir-Simpson Hurricane Scale. Hurricane Katrina, the costliest hurricane in U.S. history, struck the U.S. Gulf Coast in late August 2005 as a Category 3 hurricane.

Gustav's strength in the Gulf will largely depend on whether it merely skims the western tip of Cuba or crosses Cuba's Sierra Maestra mountains, Studwell said.

"If it goes across the western tip of Cuba, it will only lose a little strength before intensifying again in the Gulf," he said. "But if it goes into the Sierra Maestras, it's going to get torn up."

Gustav was about 50 miles south of Port-au-Prince, Haiti, and 240 miles southeast of Guantanamo, Cuba at 11 a.m. EDT Tuesday as a Category 1 hurricane, according to the National Hurricane Center. The storm was moving northwest at about 9 miles per hour, with maximum sustained winds close to 90 miles per hour.

Gustav was expected to move over southwestern Haiti later Tuesday and near or just south of eastern Cuba on Wednesday, NHC meteorologists wrote in a forecast update. The NHC predicted that Gustav would be a Category 3 hurricane in the southern Gulf by 8 a.m. EDT on Sunday.

Hurricane models diverged widely in predicting where Gustav would make landfall after it enters the Gulf. Two models showed an area of high pressure forcing Gustav westward toward Mexico's Yucatan Peninsula, while three other models forecast that the storm would head toward the central Gulf, including the Texas, Louisiana and Mississippi coasts.

"Florida doesn't seem to be a likely target," said Eric Wilhelm, a senior meteorologist with AccuWeather, Inc., a private forecaster based in State College, Pa. "Gustav is more likely to track further west into the Gulf."

Gustav's rapid intensification into a hurricane roiled the energy markets Tuesday. Nymex natural gas for September delivery was trading 53.8 cents higher, or 6.88%, at $8.363 a million British thermal units Tuesday afternoon, while Nymex light, sweet crude oil for October delivery was $1.51 higher, or 1.31%, at $116.62 a barrel.

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