Aomori City, Japan (Platts)--9Jun2008

The US and its oil industry has benefited from "two years off" in major
hurricane activity in the Gulf of Mexico and the Atlantic to better prepare
for the coming storm season, US Energy Secretary Samuel Bodman said Saturday.
"The industry is reasonably well-prepared," Bodman told reporters at
Aomori, Japan, at the G8 energy ministers summit.

The oil industry "has had a couple years to get caught up and that's the
time frame that people said they needed," to move land equipment away from
sea-level and make other preparations.

The National Oceanic and Atmospheric Administration said May 22 that
it expected a 65% probability of an "above-average" hurricane season in the
Atlantic beginning in August. NOAA said this season, which runs typically till
October, will likely see as many as five "major" storms, which will pack winds
of higher than 111 mph, which means storms of Category 3 and higher.
A typical hurricane season has only two such storms.

Hurricane Katrina, which devastated New Orleans and oil platforms in
the Gulf of Mexico, was a Category 5 storm.

During the past two hurricane seasons, however, NOAA has issued forecasts
for higher-than-normal hurricane activity only to downgrade their forecasts
later in the year.

Bodman, however, said the US was not counting on another break this
season.

"The government is, I think, well prepared," he said. The Department
of Homeland Security, which includes the Federal Emergency Management Agency
"has gone to great lengths to plan for all sorts of eventualities that we
might encounter."

Hurricane Katrina, and its sister storm Rita, destroyed dozens of oil
platforms and forced the evacuation of hundreds of others in the Gulf of
Mexico in August and September of 2005. The storms knocked out about 25% of
the US' oil production, about 1.4 million b/d, prompting a spike in oil and
gasoline prices and leading President George Bush to make available 11 million
barrels of oil from the Strategic Petroleum Reserve.

Bodman said that in the case of severe oil supply disruptions resulting
from such hurricanes the US would take oil from the SPR. "We will make it
available, just as we did the last time," he said.

The US oil reserve stands at about 704 million barrels, just shy of its
727-million-barrel capacity.

Last month, Bush acceded to Congress and ordered a halt to filling the
reserve after lawmakers from both parties complained that filling the SPR
contributed to soaring oil prices.
--Staff reports, newsdesk@platts.com