As Oil Spills into the Gulf of Mexico Eyes Pump Prics Adjust
Posted by Karen Thomas on Thu, Apr 29, 2010 @ 12:00 AM
As smoke plumes soar into the skies in the Gulf of Mexico, oil prices adjust as BP's offshore oil rig burns away. Environmentalists, the National Coast Guard, the National Oceanic and Atmospheric Administration (NOAA) are fighting along with BP to curb the environmental catastrophe that lies ahead. As oil continues to leak into the Gulf of Mexico, oil prices fluctuate as one of the world's largest oil suppliers deals with major PR repair and also a shortage in supply.
According to Steve Goldstein of Market Watch, "BP on Tuesday reported a more than doubling of its first-quarter profit as the oil giant, battling an oil spill in the Gulf of Mexico, benefited from a recovery in prices as production was steady. BP (NYSE:BP) (LSE:UK:BP.) said its profit rose to $6.08 billion from $2.56 billion during the same period of 2009," (www.marketwatch.com.)
As Coast Guard crews battle blazes on the damaged oil rig, U.S. drivers face a potential upswing in fuel prices. Truck drivers who rely on diesel fuel would've seen a slight increase in fuel prices in most regions, but nothing too disturbing. Market Watch though, reported that, "BP's profit came as it sold liquids -- basically, oil -- for $71.86 a barrel on average, up from $68.02 in the fourth quarter and $41.26 in the prior-year period. Natural-gas prices, at $4.26 per thousand cubic feet, were 17% ahead of last year's depressed levels," (www.marketwatch.com.)
The estimated cost to provide relief to the stricken Gulf of Mexico exceeds $100 million. Efforts are being made to seal off the damaged pipelines that are spewing oil into the ocean from thousands of feet below sea level. The NOAA predicts relief efforts will go on for months.
While fuel price fluctuations were modest this past week, the transportation industry will be keeping close tabs on prices at the pump.