Sources say BP may be restarting half of the 200,000 barrel-per-day production from the eastern side of Prudhoe Bay, Flow Station #1, by the end of September. The top US pipeline regulator (we never, for a minute, thought there was no such thing) is supposed to tour the facilities on Friday

Winter is coming soon, and it is either start pumping gas through those pipelines or empty them out. If oil congeals in the pipes, there would be a risk of environmental damage in case the lines developed leaks in the winter. BP’s eye is black enough already.

Fed regulators are proposing a new method for estimating fuel economy for vehicles. Drivers have complained that current mpg estimates don’t reflect everyday driving.

The first change in 20 years to the EPA’s mileage test procedure will likely cut highway driving mpg for many models by 15%, and city by 20%. The EPA would add new tests that simulate high-speed driving, rapid acceleration, and stop-and-go driving in traffic. Also considered will be starting in cold temps, and running a/c in warm climates.

“The old system is broken,” said Jason Mark, director of the clean vehicles program for the Union of Concerned Scientists. “This is a good first step in fixing it.”

Gas-electric hybrids will be most affected, with city drivings ratings down by 20-30%

Crude oil traders are focused on the weather in recent days. As last week ended, prices moved higher. The memory of Hurricane Katrina, almost exactly one year ago, is still fresh in the minds of energy traders. No one wanted to be caught in a short position if weather worsened over the weekend.

As the path of Ernesto became clear, traders realized that it would miss the major energy installations. Some believe that the market is over-reacting to the weather, with little attention to fundamentals, and that might be true. Crude was back below $70/barrel.

There has been a corresponding dip in the one-year prices for gasoline and diesel. The astute fleet manager looks for dips in market prices, perhaps instituting a partial hedge.

Here is the big picture. The market says oil will not be getting getting much below $70/barrel anytime soon. Take a look at five years (60 mos.) out, oil is barely below $70 mark. 2004 in yellow, 2005 in pink, 2006 in black. (Click to enlarge.)

At Carl’s Corner Truckstop in Carl’s Corner, Texas you can fill up on American fuel made from farm crops. They call it BioWillie because Willie Nelson is the driving force behind this biofuel vision. His tourbus runs on it.

Carl’s is a well-known landmark, and his long-time friend, Willie Nelson, suggested he convert his pumps to biodiesel (really Nelson’s wife, Annie’s, idea). Willie is all for decreasing dependence on foreign oil. Willie Nelson Biodiesel Fuel Co. Now they’re breaking ground for a biodiesel production facility behind the truck stop.

Go green!