Researchers indicate that a tropical storm, expected to develop into Hurricane Rafael, may impact US Gulf oil production, reducing it by approximately 4 million barrels. Originating in the Caribbean, Rafael is anticipated to enter the Gulf of Mexico, affecting major oil-producing areas. The National Hurricane Center predicts wind speeds may reach 100 miles per hour, potentially leading to significant production disruptions.
According to Earth Science Associates, a model assessing potential losses based on storm intensity and path suggests that oil producers could face a shortfall between 3.1 and 4.9 million barrels of crude. Natural gas production may also see a loss ranging from 4.56 to 6.39 billion cubic feet. Tony Dupont, COO of Earth Science Associates, noted that extended downtimes are anticipated if structural damage occurs.
Shell (SHEL) and Chevron (CVX, Financial) have begun relocating non-essential personnel offshore in preparation for the storm. Shell has paused certain drilling operations, although production remains unaffected. Similarly, Chevron has reported no impact on its routine oil and gas production activities.
Rafael is projected to be the second most disruptive storm this year for offshore production, trailing only Hurricane Francine, which caused up to 42% of oil and 52% of natural gas production shutdowns. As the 17th named storm of the Atlantic hurricane season, Rafael's trajectory crosses oil and gas platform-heavy zones in the Gulf, with the season lasting until November 30.
Phil Klotzbach, a meteorologist from Colorado State University, highlighted that since September 24, a record 10 named Atlantic storms have formed this year.
