“CNNMoney reports that “energy producers have shut in approximately 77% of oil output and 37% of natural gas production in the Gulf of Mexico.” This is affecting three producers particularly hard — Royal Dutch Shell PLC (NYSE: RDS.A), BP PLC (NYSE: BP) and Chevron Corp. (NYSE: CVX).

And the production shut-down is significant — “nearly 1 million barrels of daily oil production is now shut down. The last time this happened was in November 2005, after Hurricanes Katrina and Rita. In addition, 2.75 billion cubic feet of daily natural gas production is now shut down” according to CNNMoney.

How much will this cost you at the pumps? The Chicago Tribune reports that if Gustav damages production significantly in the Gulf, prices at the pump could rise to $5 a gallon. It quotes CIBC analyst Jeff Rubin as saying, “The price consequences could be even worse this time. [Due to] oil and gasoline inventories [that] are lower than when Hurricanes Katrina and Rita hit, any replays of the 2005 storm season could see gasoline prices soar to $5 per gallon.”

Gustav and Gas

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