* Oil firmer above $117 after losing more than $2 Thursday
* Gustav expected to enter the Gulf as major hurricane
* Focus on OPEC, Georgia tensions ahead of U.S. holiday
(Updates prices, Gustav details)
By Santosh Menon
LONDON, Aug 29 (Reuters) - Oil rose by more than $2 above
$117 a barrel on Friday, as Tropical Storm Gustav was poised to
enter the Gulf of Mexico, raising concerns about its impact on
U.S. offshore oil and gas output.
Energy companies braced for Gustav, shutting down production
and evacuating personnel from offshore rigs. The U.S. Gulf of
Mexico is home to a quarter of U.S. crude oil production and 15
percent of its natural gas output.
Crude for October delivery <CLc1> rose $2.23 to $117.82
barrel by 1255 GMT, paring Thursday's loss of $2.56 when the
authorities pledged to release emergency stockpiles if Gustav
disrupts U.S. oil output.
London Brent crude <LCOc1> rose $1.93 to $116.10 a barrel.
Tropical Storm Gustav is forecast to strengthen into a
hurricane by Friday or Saturday as it nears the Gulf of Mexico.
(For a graphic showing Gustav's trajectory, please click on:
https://customers.reuters.com/d/graphics/gustav.jpg
Gustav, about 85 miles west of Kingston, Jamaica, was
packing winds near 65 miles per hour. When winds reach 74 mph
the storm will regain hurricane strength and the NHC expects it
to be a "large, powerful hurricane as it approaches the northern
Gulf Coast" likely on Tuesday, according to forecast tracks.
Tracks show the storm marching through key oil and gas
producing areas of the Gulf of Mexico as a powerful Category 3
hurricane, with winds between 111 and 130 mph.
As Gustav churned through the Caribbean, another storm --
Tropical Storm Hanna -- formed in the Atlantic Ocean, on a path
that could threaten the Bahamas and Florida, the U.S. National
Hurricane Center said. []
RUSSIAN SHIPMENTS
Meanwhile, electronic trading was relatively calm ahead of
the U.S. Labour Day holiday on Monday, when NYMEX floor trading
will be shut. Electronic trading on Globex will not be affected.
"We cannot advise going short into the weekend," said Edward
Meir at MF Global, adding that Thursday's late sell-off might
have had more to do with traders exiting long oil positions
than creating fresh short positions.
Oil received further support as Britain's Daily Telegraph
newspaper reported that the Russian government had told at least
one of its oil companies to prepare for a possible cut in
shipments to Europe in days in response to threatened sanctions,
citing a single unidentified source. []
Russia's second-largest oil producer LUKOIL denied that and
the country's energy minister said Moscow was doing everything
it could to ensure stable oil supplies to Europe and to keep its
good name as an energy supplier.
Traders are also eyeing an OPEC meeting scheduled for Sept.
9 in Vienna that is expected to review the oil exporting
group's output policy.
OPEC could cut output at a meeting in September but will
most likely maintain current production levels, Venezuela's Oil
Minister Rafael Ramirez said on Thursday.
(Additional reporting by Osamu Tsukimori in Tokyo; Editing by
James Jukwey)
