Hurricane Gustav Update – Better Than Expected

Hurricane Gustav made landfall this morning near central Louisiana at roughly 10 a.m. as a Category 3 storm, packing winds of over miles per hour. Fortunately, since making landfall, the storm has been downgraded to a Category 2, and how has sustained wind gusts of over 110 mph.

The major concern now that Gustav has made landfall is the storm surge that is likely to come as the back half of the hurricane comes around the shoreline. Most forecasts predict the surge will be between 8 to 12 feet.

Clearly what has happened so far has been better news than what was forecast even 18 to 24 hours ago, when most meteorologists were predicting Gustav would strengthen to at minimum a Category 4 storm before making landfall.

And, thanks to this better than expected news, the price of oil has fallen, and the price of gasoline has remained relatively stable.

According to a report on CNNMoney, the price of oil traded nearly $4 lower after Gustav made landfall, falling to slightly over $111 per barrel. In turn, the price of gasoline edged down a half cent to $3.688 per gallon.

So far, so good.

As a side note, for your education, here’s a brief overview of the hurricane scale:

• Category 1 – 74-95 mph winds, 4-5 ft storm surge
• Category 2 – 96-110 mph winds, 6-8 ft storm surge
• Category 3 – 111-130 mph winds, 9-12 ft storm surge
• Category 4 – 131-155 mph winds, 12-18 ft storm surge
• Category 5 – 155+ mph winds, 18+ ft storm surge

Clearly the Gulf Coast, and to a lesser extent the United States at large, dodged a bullet when Gustav failed to strengthen to a Category 4 storm. Let’s hope it continues to weaken, the storm surge is less than what’s being forecast and damage to the region’s refineries and production facilities is minimal.