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Updated from 1:55 p.m. EDT

Energy prices jumped Monday as Hurricane Katrina brought its wrath to the nation's primary oil and gas infrastructure along the Gulf Coast.

After topping $70 overnight, crude for October delivery closed up $1.07 to $67.20 a barrel on Nymex. Natural gas futures rose $1.46, or 15%, to $11.25 per thousand cubic feet, while unleaded gasoline added about 13 cents to $2.06 a gallon.

The storm, weakening to Category 4 at dawn and now a Category 2, made landfall in southeastern Louisiana and is now marauding through Mississippi. Katrina and its 100-mph-plus winds has shut in roughly 1 million barrels of daily refinery capacity and halted about 40% of crude production in the region.

"The current statistics show 633,000 barrels a day of crude and 2.4 billion cubic feet of gas have been shut in, but in reality it's much more than that," said Darren Horowitz, analyst at the Houston-based Raymond James. "The bigger deal is actually the shutdown of LOOP, Louisiana's oil port."

The eye of the storm reached Grand Isle, La., north of the Louisiana Offshore Oil Port, which normally processes and delivers 1.2 million barrels of imported oil a day. The port has been shut down since midday Sunday, according to spokeswoman Barb Hestermann.

The U.S. imports roughly 10 million barrels of oil a day and produces about 7 million barrels a day.

Hurricane Ivan, which slammed though the Gulf last September and made U.S. landfall at Category 3, destroyed oil rigs and pipelines and cut 43 million barrels of supply. The government released crude from the strategic petroleum reserve in order to make up for the lost production.

Michael Lynch, president of the Strategic Energy & Economic Research, a consultancy, said his biggest concern is the permanent loss of natural gas production. "Last year, Ivan caused a loss of 170 billion cubic feet over a few months. If that is repeated, natural gas prices will remain high and that would help the overall energy market stay tight."

Lynch said half a billion cubic feet of daily gas production could be lost permanently. He is less concerned about the crude oil situation, since "global crude inventories are in good shape and demand is down." He also believes lost refinery production could be restored within a couple of weeks.

"It is unlikely that we will have a lengthy outage in refining. Gasoline prices should come down in a week or two," Lynch said.

Among stocks, refinery operator



rose 2% to $91.10, while



rose 2.8% to $65.05, and

Frontier Oil

( FTO) rose 5.8% to $33.02. The

Energy Select Sector


ETF rose 1%.

Among the closed refineries are Valero's facility in St. Charles, La., and



plant in Chalmette, La.



said Sunday that it had evacuated all of its offshore rigs. Chevron's 325,000-barrel-a-day refinery in Pascagoula, Miss., was also shut down.



1,900-megawatt nuclear plant in St. Charles Parish, about 30 miles west of New Orleans, was also shut down.

Forecasters say Katrina came ashore in Plaquemines Parish, La., which is home to



247,000-barrels-a-day refinery at Belle Chase.

Murphy Oil


operates a 120,000-barrels-a-day refinery at nearby Meraux, La.

Roughly one-quarter of U.S. crude and natural gas output is located along the Gulf Coast. About one-sixth of the U.S. oil supply comes through facilities at Port Fourchon, La.

In a note to inventors, RBC Capital Markets said exploration and production companies such as

Southwestern Energy



Quicksilver Resources



Chesapeake Energy


are the most exposed to rising natural gas prices and the least exposed to the Gulf of Mexico. (The brokerage has an investment banking relationship with the companies.) Chesapeake shares rose 2.2% to $28.78.

Spinnaker Exploration

( SKE), according to RBC, has the greatest risk of losing production as 40% of its operations were likely hit by storm. Shares fell 1.7% to $42.73.

"Net daily production of approximately 110 million cubic feet of gas equivalent is currently shut in as a result of Hurricane Katrina. The duration of production shut-ins is unknown at this time, but some production will likely recommence by tomorrow," Spinnaker said in a statement. "The eye of Hurricane Katrina appears to have passed approximately 70-80 miles east of the company's Front Runner facility ... Spinnaker is not certain at this time when personnel will be sent back to the facility by the operator."

Energy prices refused to soften despite bearish commentary from OPEC overnight. Wire reports quoted the cartel's current chief, Shaikh Ahmad al-Fahd al-Sabah of Kuwait, expressing concern Monday about the refusal of oil prices to decline from recent high levels.

"We are becoming increasingly concerned at the continuing high level of oil prices, which does not properly reflect the underlying fundamentals of the market," he said. "OPEC will be exploring various options for the September meeting which will hopefully contribute to moderate prices.

Earlier at the New York Mercantile Exchange Monday, a force majeure was declared over all remaining delivery obligations in the September natural gas contract, after the Sabine Pipeline, which operates the Henry Hub facility in Louisiana, was reportedly shut down ahead of the storm. A force majeure means that producers won't be penalized for failing to deliver gas on time because of unexpected events. The Sabine Pipeline delivers the commodity from Henry Hub, the benchmark wholesale point for natural gas trading in the U.S.

Among oil service companies, shares of

Cal Dive

( CDIS), which provides marine construction services and is poised to benefit from producers' rig repair efforts after the storm, rose 5% to $55.81. Cal Dive's peer,

Global Industries


, also jumped 11% to $11.85 on reconstruction profit potential.

Meanwhile, some companies have began assessing Katrina's damage.



, the contract drilling company, reported that one of its rigs, the Deepwater Nautilus, was dislocated from its mooring and has drifted off location. Three other of Transocean's moored vessels were safely evacuated and have remained on location.