The oil market has been supported by the possibility of a storm in the Gulf but today more concerns about the global economy may try to temper any gains. Overnight currencies are going back into defensive mode with the Euro breaking the Swiss and dollar rallying. Today we have concerns about a profit warning from French conglomerate Lagardere SCA and a less than stellar China Purchasing Managers Index which rose to 50.9 in August, up from July's 50.7. Still it did not blow us away so now for oil, it might need the storm to blow us away.

As of now the ominous storm near the Gulf of Mexico has a 60% chance of becoming a tropical cyclone. Already there are reports that some production and imports could be impacted. Reuters News reported, BP Plc on Wednesday became the first major oil producer to say it was evacuating some workers from Gulf of Mexico oil and gas company-operated oil and gas platforms, said it was evacuating from five platforms more than 500 nonessential workers, or those not directly involved in production, such as cooks. (Cooks aren't essential? I hope they have a microwave). The platforms involved are Thunder Horse, the world's largest with capacity to produce up to 250,000 barrels of oil per day, and Na Kika, Mad Dog, Holstein and Atlantis. Essential personnel remain on board to continue safe operations and prepare the platforms for potential shut-in and full evacuation in the event it becomes necessary, the company said in a statement. Shell is the second-largest producer in the Gulf, operating six oil and gas platforms. Mexico's state oil monopoly Pemex said it was monitoring the weather but not yet taking any emergency or precautionary measures.

The crude oil market will also have more than the weather to contend with. There are more macro-economic storms on the horizon as well with a full slate of data both today and tomorrow. The big one today should be the ISM manufacturing report that could make or break oil and gas demand expectations.

Speaking of gas we saw a big jump in natural gas due in part to the storm and the fact the market was oversold into major support. Today we see gas data and I am looking for an upside surprise, meaning higher storage. I think the storm impacted demand and we should see an increase in supply.

Yesterday we saw that the storm impacted crude oil imports with a huge increase in the East coast. It appears that all the ships tried to beat hurricane Irene and did a god job of it. Gas supplies did fall hard and according to the Energy Information Agency and they want to know when it comes to gasoline consumption, how did we get here? They said, With the upcoming Labor Day weekend marking the end of the peak driving season in the United States, it is a good time to review recent trends in U.S. gasoline consumption, which accounts for about 10 percent of total global oil demand. The U.S. Energy Information Administration (EIA) data indicate gasoline consumption in the first six months of 2011 was 2 percent lower than in the same period in 2010. Economic growth, gasoline prices, and vehicle fleet efficiency are three key determinants of gasoline use. Economic growth and prices impact vehicle miles traveled, while fleet efficiency, which changes only slowly based on efficiency of new vehicles relative to the efficiency of the existing fleet and the rate of fleet turnover, links miles traveled to fuel use. Higher gasoline prices in 2011 compared to the same period in 2010 appear to be the main driver behind the recent drop in gasoline demand. The impacts of increased economic activity and increased vehicle efficiency, which move gasoline demand in opposite directions, were each about half the size of the impact of higher prices, and taken together the two effects were largely offsetting.

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