Crude oil closes below $110 per barrel in New York

Crude oil prices fell substantially Tuesday after Hurricane Gustav passed through the Gulf of Mexico and made landfall on the US Gulf Coast without doing much damage to oil facilities in the region over the Labor Day holiday weekend in the United States.

Almost all activity on offshore oil and gas platforms in the Gulf of Mexico was halted and 23 Gulf Coast refineries were shut down either partially or completely ahead of the storm.

It was unclear when Gulf oil production would resume, but some companies said they might start sending workers back to offshore platforms as early as Wednesday after finding little damage in their initial assessments and it was estimated that it could take three or four days to get refineries started back up.

The strong dollar was another factor in reducing the price of oil.

October contracts for West Texas Intermediate crude was down $5.75 to $109.71 per barrel at the close of floor trade on the New York Mercantile Exchange after going as low as $105.46 in earlier trade.

Nymex October gasoline futures and October heating oil each fell 12 cents, to $2.73 per gallon and $3.07 per gallon respectively, while October natural gas dropped 65 cents to $7.29 per million British thermal units.