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Reuters - The head of oil major Total warned of tougher safety rules that could push up crude prices as the first storm of the Atlantic hurricane season compounded the impact of the Gulf of Mexico oil spill.

The storm cast more crude into beaches and marshes and left BP Plc unlikely to resume cleanup efforts for a fourth day.

Total CEO Christophe de Margerie said it remained necessary to drill in deep-water fields to meet global demand for fuel.

"Our policy is clearly toward zero risk," the Wall St Journal quoted de Margerie as saying on Friday. "All this means ... potential additional costs," he said, warning oil prices could reach $90 a barrel by year end.

As Hurricane Alex dissipated over Mexico, authorities and residents along the U.S. Gulf Coast faced a sudden surge in oil contamination of their shores.

BP and U.S. Coast Guard officials said they would probably need to wait until Saturday to put most of their spill-response teams back to work on skimming oil, spraying dispersants, rescuing wildlife and burning petroleum at sea.

Robert Dudley, chief of BP's Gulf Coast restoration efforts, said high seas and winds were propelling the landward advance of the far-flung oil slick.

"It has brought in oil, unfortunately, from the panhandle of Florida to Louisiana ... at a higher rate than it has been over the last few days," he said in a live PBS online interview.

However BP moved closer to agreement with environmental groups and the U.S. Coast Guard on measures to prevent sea turtles from being killed in controlled burns of spilled oil.

A deal would settle a lawsuit accusing BP of violating the U.S. Endangered Species Act and terms of its lease with the federal government for the well which ruptured on April 20, unleashing the worst offshore spill in U.S. history.

SEA CONDITIONS

Like Dudley, Coast Guard Commander Charles Diorio said he doubted sea conditions would be calm enough to resume full-scale cleanup and containment efforts on Friday.

"Operations will likely be curtailed," Diorio told reporters. "We expect the seas to start to calm down as we get into Friday and further into the weekend."

Those operations, involving nearly 43,000 personnel and more than 7,000 vessels, were halted on Tuesday as weather conditions worsened with the approach of Alex.

Meteorologists have warned that this hurricane season, which began on June 1, is likely to be one of the most intense in years, with as many as five major tropical storms expected.

Any one of them could seriously compound an environmental and economic disaster unleashed by the explosion that demolished the Deepwater Horizon drilling rig and killed 11 crew members.

Millions of barrels of crude have gushed from the floor of the Gulf since then, bringing much of the region's fishing industry to a halt, strangling its tourist trade, soiling its beaches and killing wildlife.

A hoped-for halt to the flow of oil is still weeks away and BP's finances have taken a beating as the crisis wears on.

The company's market capitalization has shrunk by about $100 billion and its shares have lost more than half their value since the spill began. But shares have shown signs of stabilizing and were little changed in London trading on Friday, up 0.1 percent at 328.25 pence by 1016 GMT.

The White House is expected to release details of a revised moratorium on deep-water drilling in the next few days. A federal court order last week blocked the government's initial ban on drilling exploratory and development wells in waters more than 500 feet deep and a revised plan could still face legal challenges.

RELIEF WELLS

Rough weather spawned by Alex has delayed plans by BP to expand the volume of oil being siphoned from its ruptured wellhead on the Gulf floor.

But the drilling of two relief wells aimed at plugging the leak by the middle of next month has continued.

Government officials estimate between 35,000 barrels (1.47 million gallons/5.56 million liters) and 60,000 barrels (2.5 million gallons/9.5 million liters) of oil pour from the undersea geyser daily.

BP's current oil-funneling systems, which continued to function through the storm, can handle up to 28,000 barrels daily and its planned addition could raise that to 53,000.

The storm surge from Alex also pushed more of the slick toward the northwest, in the direction of Mississippi and Louisiana, after a week in which the oil had crept mainly toward the northeast, washing up on Florida Panhandle beaches.

Mississippi officials on Thursday closed down the last open portion of that state's territorial marine waters to all commercial and recreational fishing, citing an increase in the amount of oil driven ashore by the storm.

In a development BP hopes will enhance its oil-collection efforts, a supertanker converted to operate as a giant oil skimmer will be given a test run on Saturday.

The 1,100-foot (335 meter)-long vessel, owned by TMT shipping of Taiwan and dubbed the "A Whale," can collect 500,000 barrels (21 million gallons) a day of contaminated water, spill response officials said.

(Additional reporting by Matt Bigg in Boothville, Louisiana, John Parry in New York, Jane Sutton in Miami, Alyson Zepeda, Bruce Nichols and Eileen O'Grady in Houston, Leigh Coleman in Mississippi, and Richard Cowan and Matt Spetalnick in Washington; writing by Steve Gorman and David Holmes; editing by Doina Chiacu and Karen Foster)



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Any excuse to raise prices. Like these oil giants are barely squeaking out a profit. Just seems to me that the genie was let out of the bottle with the embargo in the 70s. What I do find to be most disingenuous, however, is that both the oil producers and the commodities traders that are both primarily responsibly for driving up the price, make the bald-faced assertion that since there is a finite supply of petroleum on the planet, they are somehow doing society a favor by hiking prices, thereby spurring conservation.

ain't it the truth

I'm going to by a horse...

Guess that means there's no way I'm moving in downwind of you!

Don't worry, we'll keep him on a bean free diet...