A really energetic Atlantic hurricane season thus far this 12 months has not despatched storms throughout U.S. oil and pure gasoline fields within the northern Gulf of Mexico, sparing vitality firms billions of {dollars} of losses and customers greater gasoline prices.
The 2023 Atlantic hurricane season has been one other in a string with above common exercise producing three main hurricanes with winds above 111 mph (179 kph) out of six hurricanes amongst 20 named tropical storms.
So far this 12 months, just one storm, Tropical Storm Harold, on Aug. 23 disrupted operations on the three refineries in Corpus Christi, Texas, only for a day resulting from energy outages.
That was the largest impression to the Gulf Coast oil trade this 12 months. Gulf of Mexico offshore operations account for 15% of U.S. crude oil manufacturing and 5% of the nation’s pure gasoline manufacturing, whereas about half the nation’s refining capability and pure gasoline processing plant capability is situated alongside the Gulf coast.
“We got really, really lucky this year,” stated Colin White, guide with Rystad Energy in Houston. “But there is still an inherent risk that producers have to take into account.”
The hurricane season formally begins on June 1 and ends on Nov. 30.
“I wouldn’t want to say the hurricane season is over, but it is waning,” stated Jim Foerster, chief meteorologist for DTN. “This season has been a powerhouse.”
Between 2019 and 2021 storms within the Gulf like Hurricane Ida shut an annual common of 24 million barrels of oil manufacturing, stated Rystad’s White.
At an assumed worth of $70 per barrel of oil, that equals a mean misplaced income per 12 months of about $1.7 billion, White stated.
So far, no offshore manufacturing has been hit.
Meanwhile, final 12 months’s hurricane season was the primary season since 2014 that left most offshore manufacturing unaffected, stated Troy Vincent, senior oil market analyst for DTN.
Less than 200,000 barrels per day (bpd) of manufacturing was shut, Vincent stated.
Refiners’ view of low-activity hurricane seasons sparing them of crude provide disruption worth, nevertheless, might change, stated Pat Jelinek, Ernst & Young Americas oil and gasoline chief.
“As we’ve seen in recent years, tropical storms in the Gulf of Mexico can have significant impact on energy operations, disrupting energy production, supply chains and pricing,” Jelinek stated.
“However, the energy system is changing,” he added. “Reduced global production of oil and gas has made feedstocks more expensive. The benefits of a milder hurricane season may not be the boon refiners and consumers had once seen.”
(Reuters – Reporting by Erwin Seba; Editing by Marguerita Choy)
