Hurricanes, Oil & Shipping

It is absolutely upsetting to see the pictures and read the stories of those affected so dramatically by the hurricanes in the Gulf of Mexico. The devastation in some of these communities seems irreversible.

A silver lining with these 2008 storms is the minimal damage to the oil refineries in the Gulf. The anticipated but un-materialized damage to infrastructure has taken some of the crazy speculation out of the global oil market.

With the price per drum dropping below $100 per barrel from a high of nearly $150 I suspect that the inflationary pressures on many products will weaken. More importantly the cost of shipping and fuel surcharges should start to come down – although I’m sure not as quickly as they went up in the past 12 months.