Oil Prices Fall Sharply as Gustav Weakens ... down $4.70 to $110.76 a barrel

Oil Prices Fall Sharply as Gustav Weakens

http://www.nytimes.com/aponline/business/AP-Oil-Prices.html?_r=1&oref=slogin

By THE ASSOCIATED PRESS
Published: September 1, 2008

Filed at 12:28 p.m. ET

Oil prices tumbled to below $111 a barrel Monday as weather forecasters
said Hurricane Gustav was weakening as it advanced toward Louisiana.

A stronger dollar also helped reverse the course for oil prices, which
had risen by nearly $3 to over $118 a barrel earlier in the session.

Still, precautions due to Gustav prompted companies to shut down drilling
and refining operations in the Gulf Coast region.

By late afternoon in Europe, light, sweet crude for October delivery was down
$4.70 to $110.76 a barrel in electronic trading on the New York Mercantile Exchange.
Earlier in the session, it had reached a high of $118.25 before retreating.

On Friday, the contract fell 13 cents to settle at $115.46 a barrel.

In London, October Brent crude was down $4.32 to $109.73 a barrel on the
ICE Futures exchange. U.S. trading was closed Monday for Labor Day.

''There's no question the drilling platforms in the Gulf of Mexico and the big refineries
between Houston and New Orleans are in the path of this hurricane,'' said Victor Shum, an
energy analyst with consultancy Purvin & Gertz in Singapore. ''There's likely to be some
damage. We could see an extended period of disruption.''

Some analysts, however, said the market's response to Gustav was not as strong as some predicted.
U.S. energy risk management firm Cameron Hanover described reaction as ''extremely subdued.''

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