Economic Calendar

Tuesday, September 9, 2008

Hurricane Ike Lashes Cuba, Kills 4; May Hit Gulf Rigs

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By Brian K. Sullivan and Camilla Hall

Sept. 9 (Bloomberg) -- Hurricane Ike tore across central Cuba, killing four people and prompting mass evacuations, before heading for the country's west and the Gulf of Mexico, potentially threatening U.S. oil rigs.

Ike's eye was over water about 135 kilometers (85 miles) south-southeast of Havana at 5 a.m. Cuba time today, moving west at 20 kph, the U.S. National Hurricane Center said. The system's sustained winds dropped to 130 kilometers per hour as it moved over land, weakening to Category 1, the lowest on the five-step Saffir-Simpson scale of intensity. The hurricane is forecast to regain strength as it moves over the warm Gulf waters.

``It could be a major hurricane before it gets to the western Gulf Friday and Saturday,'' Accweather.com senior meteorologist Paul Walker said today in a telephone interview. ``There are certainly going to have to be some precautions taken for the oil rigs in the Gulf.''

Cuban authorities evacuated as many as 2 million people, or almost a fifth of the population, as Ike approached, according to Agence France-Presse. Four people were killed and seven injured, the news agency said.

``It looks like it is going to be the worst hurricane they have had in Cuba for a while,'' Accuweather.com meteorologist Dave Samuhel said by phone yesterday. ``It is going to be a pretty bad situation for them.''

Hit Eastern Cuba

The hurricane made landfall in eastern Cuba at Category 3. A second landfall is likely in the west of the country, forecasters said. International broadcasters televised images of waves crashing over five-story buildings on the north coast as Ike swept ashore two days ago.

Cuba issued a hurricane warning for the provinces of Matanzas, La Habana, Ciudad de Habana, Pinar del Rio and the Isle of Youth. Tropical-storm warnings were in effect in the Florida Keys from Ocean Reef to the Dry Tortugas, the center in Miami said. In the Cayman Islands, Little Cayman and Cayman Brac were under a tropical-storm warning, while Grand Cayman was under a tropical-storm watch.

Ike is forecast to move over the waters between the Isle of Youth and the south coast of Havana province in the next several hours, then move over western Cuba later in the day, the center said. On its current track, the storm's second landfall in western Cuba will take place today.

Cuba may receive 51 centimeters (20 inches) of rain that could trigger flooding and mudslides, the center said.

Deaths in Haiti

Ike killed 66 people in Haiti, AFP said. At least 600 people were killed when Ike, Hurricane Gustav and two tropical storms either hit the country or passed close by in the past month, AFP said. As many as 600,000 people may need assistance, United Nations humanitarian affairs chief John Holmes said.

Texas Governor Rick Perry issued a disaster declaration yesterday along the coast in preparation for Ike's landfall.

Ike, coming on the heels of Gustav last week, may keep U.S. oil and gas production in the Gulf closed until at least mid- September. The Gulf is home to more than a quarter of U.S. oil production. The center's five-day track shows Ike on a course for a U.S. landfall on the southern coast of Texas, west of installations battered by Hurricane Gustav.

``A lot of them are still shut in, and the concerns might be, do we want to start up operations and spend the money to ferry and fly crews back out only to pull them back in a couple of days?'' said Jim Rouiller, a meteorologist with Planalytics Inc. in Wayne, Pennsylvania.

Oil Workers

Energy producers reported that personnel from 10 rigs and 202 production platforms have been evacuated, according to the Minerals Management Service. There are about 717 manned production platforms in the Gulf of Mexico.

The weakening of Ike helped push down oil prices. Crude oil for October delivery fell as much as $1.57, or 1.5 percent, to $104.77 a barrel and traded at $105.51 at 9:01 a.m. London time on the New York Mercantile Exchange.

Ike may enter the Gulf as a ``stronger and more organized storm,'' Rouiller said by telephone. ``A Category 3 appears likely based on its projected track,'' Rouiller said. ``All lights are green for rapid strengthening once it gets into the Gulf.''

Urban search and rescue teams and supplies have been positioned in Texas, Louisiana, Mississippi, Alabama and Florida in anticipation of Ike's landfall later this week, the Federal Emergency Management Agency said in a statement.

Florida Keys residents who evacuated over the weekend should be able to return home by Sept. 13, or perhaps a day or two earlier, the agency said. Ike should have passed the region completely by Sept. 10.

Louisiana

Ike's track has shifted southward after forecasters in Miami predicted earlier this week that the storm was on a course for Louisiana. The state's governor, Bobby Jindal, declared an emergency two days ago as Ike headed toward the Gulf. New Orleans residents who fled as Gustav approached last week were warned to prepare to evacuate again.

New Orleans, which was devastated by Hurricane Katrina in 2005, was spared the worst of Gustav, although 25 people were killed in Louisiana, according to the state's chief medical officer, Louis Cataldie.

Haley Barbour, governor of Mississippi, also declared a state of emergency as a precautionary step, according to a statement yesterday.

To contact the reporters on this story: Brian K. Sullivan in Boston at bsullivan10@bloomberg.net; Camilla Hall in London at chall24@bloomberg.net.


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