Bush focuses on Rita's hit on oil industry
(AP)
Updated: 2005-09-26 19:01

Concerned about Hurricane Rita's damage to coastal oil refineries, President Bush turned his attention to the nation's energy industry as early economic indicators offered reason for optimism and a speedy recovery, AP reported.

President Bush talks to staff at the Joint Filed Operation office of FEMA in Baton Rouge, La., as Lousiana Gov. Kathleen Blanco, center, and Vice Admiral Thad Allen, right, listen, Sunday, Sept. 25, 2005. In an early morning briefing, military officials told President Bush on Sunday that the U.S. needs a national plan to coordinate search and rescue efforts following natural disasters or terrorist attacks. In the foreground is Richard Deir of the FEMA Urban Search and Rescue National Response System. [AP]

Officials prepared to brief Bush at the Energy Department on Monday after a weekend of monitoring Rita's damage in Texas and Louisiana.

While preliminary assessments show little damage to most refineries, a key economic Bush aide said hundreds of thousands of jobs were at risk if the storm stunted oil production.

"I remain pretty optimistic about the economy," Ben Bernanke, chairman of the White House Council of Economic Advisers, said in a speech Sunday.

However, he added, "There is of course the direct impact of the shutting down a part of the economy, the loss of several hundred thousand jobs and reduced energy production in the Gulf."

Crude oil futures fell sharply in unusual Sunday trading as it appeared that oil rig and refinery damage from the storm was less than originally feared. A barrel of light crude for November delivery was quoted at $62.80 on the New York Mercantile Exchange, down $1.40.

But 16 Texas oil refineries remained shut down after the storm, and crews found significant damage to at least one in the Port Arthur area, said Energy Department spokesman Craig Stevens.

Government officials were satisfied with the response to Rita, including better stockpiling of supplies, early evacuations and more military muscle than deployed four weeks ago against Hurricane Katrina.

But Bush, anticipating future disasters, began pushing a politically sensitive proposal to give the military a larger role in search-and-rescue missions.

"Clearly, in the case of a terrorist attack, that would be the case," he said. "But is there a natural disaster — of a certain size — that would then enable the Defense Department to become the lead agency in coordinating and leading the response effort?"

The president said he would ask Congress to consider putting the Pentagon in charge of disaster rescues after senior officers indicated the need for such a national plan.

His proposal divided lawmakers trying to balance an adequate federal response against trampling on states' rights.

Currently, the Homeland Security Department and the Federal Emergency Management Agency lead response missions in large-scale disasters. If federal troops are brought in to help, they do so in support of FEMA, through the U.S. Northern Command. The command was set up as part of a military reorganization after the Sept. 11, 2001, attacks.

Officials said that over the weekend federal teams rescued more than 400 people and treated more than 200 for injuries from Rita. They also pointed to hundreds of truckloads of food, water, ice and cots that were lacking during the immediate aftermath of Katrina.

R. David Paulison, FEMA's acting director, credited early evacuations as the key to saving lives, but he and local officials warned against letting residents return too soon to twice-flooded New Orleans.

"Our response operation is in full swing," Paulison said. "The coordination and smooth preparation for this hurricane has been absolutely phenomenal."