Manipulating the Market

As word comes down that the Bush Administration is planning a release from the Strategic Petroleum Reserve to counter lost production from the Gulf, oil companies started assessing damage to their facilities on Tuesday. At least initially, the news wasn't all that bad:

Oil companies are getting their first glimpse today of facilities battered by Hurricane Katrina in the Gulf of Mexico.

On a reconnaissance flight, Shell found damage to at least one of its facilities, its Mars platform, which it said "sustained topside damage" -- the structure above the ocean housing controls, production equipment and quarters.

The company said it plans to send crews via helicopter today to several of its facilities to perform detailed inspections.

BP started helicopter flyovers of several of its facilities today, and so far, the news has been good.

"No damage was observed from these aerial overflights, but we'll know more when we get the folks on board to complete their more detailed onboard inspections," said Hugh Depland, a spokesman for BP.

BP has already started to move small crews to some of its platforms. The crews will restart generators and inspect the facilities for damage prior to bringing them back on line.

The company did discover a mobile drilling rig that had become adrift and ended up next to its Holstein platform.

As for our take on releasing oil from the Strategic Reserve, we've already made our position known; it's the refining capacity, stupid!