Hurricane Gustav has been the talk of the News wires this entire Labor Day Weekend. The New York Mercantile Exchange (NYMEX) opened up trading for a special session today to allow Traders to adjust positions pre-Gustov. Oil gained 1.67 for October Devilry to $117.13 a Barrel, Gasoline gained 6.58 cents or 2.3% to $2.92, and Natural Gas fell 6.1 cents or 0.8% to 7.882 per million British Thermal Units.
I am Long VLO SEP 34 Calls in preparation for Gustav. I except that the refining sector, among the worst performers of the last 12 months will receive a huge boost from the storm. When the refining capacity drops, the refiners can operate with much better margins. Even if oil prices rise, the refiners margins will increase substantially.
Look at stocks like VLO, TSO, and WNR. If the stocks behave as I anticipate, I will start buying more calls come next week Tuesday.
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