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COPYRIGHT 2005 Voxant Inc.
Original Source: NIGHTLY BUSINESS REPORT
PAUL KANGAS, ANCHOR: A flood of fears about flooded refineries, as concerns mount over just how much damage was done to the facilities by Hurricane Rita. Those fears spur oil traders in New York to bid prices higher, closing above $65 a barrel.
SUSIE GHARIB, ANCHOR: President Bush is encouraging Americans to conserve energy, and he`s asking government employees to do their part as well. Still, he admits that won`t solve the nation`s long-term energy problem.
KANGAS: It`s the newest edition of the Treo, a combination of cell phone and personal digital assistant. This new model, though, is very different than the old one, and we`ll tell why.
(MUSIC)
GHARIB: That`s the sound of success of Ashanti, an R&B artist who made her mark worldwide. Tonight, a look at behind the scenes of the business of music.
KANGAS: I`m Paul Kangas.
GHARIB: And I`m Susie Gharib. This is "Nightly Business Report" for Monday, September 26th.
(COMMERCIAL BREAK)
GHARIB: Good evening, everyone. Hurricane Rita may be history tonight, but the storm is still having a major impact on the nation`s energy supplies. At the New York Mercantile Exchange, oil and gas prices slid, then ignited, as traders tried to gauge the damage from Rita.
Meanwhile, President Bush urged Americans to conserve energy.
We have two reports this evening detailing today`s action in the oil pits and in Washington. We begin with Erika Miller in New York.
ERIKA MILLER, CORRESPONDENT: A striking turnaround in the New York oil pit today, as traders struggled to assess the damage to oil facilities caused by Hurricane Rita.
RAYMOND CARBONE, OIL TRADER, PARAMOUNT OPTIONS: It seems like a lot of people are just trying to digest the information that has been coming out since the storm hit. Some of it is positive, a lot of it is negative, a lot of assessments haven`t been done yet. So really, it`s conjecture at this point.
MILLER: November crude futures fell sharply at the start of trading, but reversed course late in the day to close up $1.63 at $65.82 cents a barrel. Oil initially fell on preliminary reports, showing little damage to Gulf Coast refineries. The hardest hit appears to be to a Valero plant in Port Arthur, Texas, which will need at least two weeks of repairs.
But late in the day, traders started to rethink Rita`s impact. Roughly 15 percent of national refining capacity remains offline along the Gulf Coast, and most of the region`s oil and natural gas production is still at a standstill. Now, traders fear those outages will lead to fuel shortages and higher prices.
MICHAEL ROTHMAN, ENERGY ANALYST: There`s a general fear that we`re simply running out of oil, that there`s not enough capacity to produce it, not enough capacity to refine it. And it`s becoming a very emotional, also bullish, entrenched view that sits out there.
MILLER: Another concern for energy markets is coming cold weather. Many refineries have delayed their annual switchover from gasoline to heating oil. As a result, many traders expect higher energy prices this winter, especially for heating oil.
CARBONE: There has been no turnaround, no heating oil being produced in any meaningful way recently. I think that`s going to come back and haunt the market.
MILLER: Just how much higher could your heating bill be this winter? The Energy Department expects prices to be up roughly 35 percent over last year, but analysts think that`s too conservative.
Erika Miller, "Nightly Business Report," New York.
STEPHANIE DHUE, CORRESPONDENT: I`m Stephanie Dhue. The high cost of gasoline is on the mind of President Bush. Today, he called on Americans to cut out nonessential driving. He says the...
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