Information from the Gulf of Mexico is developing each day, and the extent of damage from Harvey to the energy industry’s infrastructure is still largely unknown as of September 5th. I detail below the potential impacts on supply and demand for crude and petroleum products. I have also contrasted them to supply/demand responses to Hurricane Katrina (2005) followed by Hurricane Rita.
Crude Production
The best data show that about 324,000 b/d is shut down in the Gulf of Mexico (GOM). Also, up to 300,000 b/d of inland production may be affected in Eagle Ford.
Hurricane Katrina made its landfall on August 29, 2005, in Southeast Louisiana, not Texas, as a Category 3 hurricane. It caused significant damage to oil and gas industry infrastructure. It was followed by Hurricane Rita, which made landfall on September 24th, also as a Category 3 hurricane.
The initial impact on crude production was about 1.2 million barrels per day (mmbd). GOM production at that time was about 400,000 b/d lower than the most recent estimates.
Continue reading "Analysis Of Hurricane Harvey Impacts On The U.S. Oil Industry"
