World wide, demand for oil has permanently exceeded supply, and the supply is peaking around now - which means the gap between supply and demand will grow at an even greater rate. “Proven reserves” aren’t really proven, and none of the largest oil fields in the world have been able to increase their production significantly for some time. Investment in finding new deposits is way down – because the technology introduced in the 80s and 90s showed there isn’t enough more new stuff to be found to justify the investment. They’re not building many more tankers or refineries either – for a lot of reasons, but mainly because there are already enough for the future availability of crude, which means it’s a bad risk on such an expensive, long term investment. With such a tight supply world-wide, it takes very little disruption in supply to send things out of control. The hurricanes just showed us a small preview of what is to come – a bump along the continual upward price trend.
As far as the immediate impact of Rita, keep in mind they still don’t know the extent of the damage to the oil platforms in the Gulf. Rita was still a Cat4 when it went over a lot of them, which means supply may be disrupted for some time, and then we have to replenish the oil that came out of the Strategic Petroleum Reserves. The end of the petroleum era is now – sure there will be oil, but it will be ever more expensive to get, and we’ll have to fight with everyone else that wants it too.
It’s unfortunate that the oil companies are allowed to take advantage of the situation, as it makes people think that there is no real problem, and that it’s all artificial and soon things will go back to normal. They are never going back to “normal”, and I fear this winter will be quite unpleasant.