In the past week, the energy markets have sold off steeply, even in the face of as-still-unknown damage from (a weaker than expected) Hurricane Gustav. If you were reading theoildrum.com of late, you have seen Kinetic Analysis Corp periodic updates on modeled damage/shut in production to Americas oil and gas facilities. We are also continuing to accumulate stories, data, and observations about the effects of Gustav on oil, natural gas, and gasoline production in another thread below.

Tonight another hurricane (of sorts) was announced in the financial press when CNBC reported that Ospraie, a $4 billion hedge fund partially owned by Lehman Brothers (and a major energy player), is closing it's doors after being down nearly 40% in 2008 following a -26% August. While this example is possibly unrelated to the current energy market meltdown, it serves as a good example of what may be a continued theme in natural resource markets - their small size in relation to the nominal amount of dollars seeking financial returns.