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Gulf Coast Oil Firms Express Relief As Gustav Lifts

RENEE MONTAGNE, host:

And turning back to a story we're following today, Gustav did not lead to a spike in oil prices. Since damage from the storm appears not as bad as feared, oil prices actually dropped by $4 a barrel, closing at $111 yesterday. NPR's Carrie Kahn reports.

CARRIE KAHN: Nearly all gas and oil production in the Gulf has been shut down, and dozens of refineries are closed or operating at reduced levels. That's essentially knocked 15 percent of the nation's refining capacity offline. But industry officials say they were prepared for worse and are feeling lucky.

Mr. SHAUN WIGGINS: (Spokesman, Shell Oil Company): We are breathing a sigh of relief.

KAHN: Shell Oil Company spokesman Shaun Wiggins says officials hope to assess damage to offshore facilities as soon as they can safely fly their fixed-wing aircraft.

Mr. WIGGINS: We're in a holding pattern right now until we get that all clear. And then once we do that, we're ready to get back on the horse and get riding again.

KAHN: If all is well, industry officials say it would only be a matter of days before production is back to normal and insist they have sufficient gasoline reserves in the region. But Louisiana governor Bobby Jindal says 85 percent of gas stations in the southern part of the state are empty, and he's asked the government to open up the U.S. strategic petroleum reserve.

Carrie Kahn, NPR News. Transcript provided by NPR, Copyright NPR.

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Carrie Kahn is NPR's International Correspondent based in Mexico City, Mexico. She covers Mexico, the Caribbean, and Central America. Kahn's reports can be heard on NPR's award-winning news programs including All Things Considered, Morning Edition and Weekend Edition, and on NPR.org.