JOE BENSON
Hurricane Laura’s Effect on the National Oil Supply
Aug 27, 2020
Hurricane Laura, which has sustained wind speeds of 110 mph, is currently heading north in the Gulf of Mexico with expected landfall to happen before August 29th.
This category 4 storm has shut down 61% of natural gas pipeline facilities and 84% of oil production for the United States and Mexico. Upon the passing of the storm, all facilities will be inspected to ensure no significant damage was sustained before reopening.
Southern Louisiana is expected to take the brunt of the storm with expected water surges upwards of 15 feet. There are established evacuation routes for residents in the southern part of Louisiana currently available on the Louisiana DOTD websiteand social media pages.
There are 16 dynamically positioned oil rigs, which are not moored to the seafloor, that were moved a couple weeks ago to avoid the path of the storm. Furthermore, the storm is projected to make landfall in the area that accounts for 17% of national oil production and 45% of the national petroleum refining production capacity. Oil and natural gas production in the area could be drastically reduced depending on the direction and the severity of the storm.
On the positive side, our data is showing that the storm shouldn’t cause gas and oil prices to rise, even if it hinders certain refineries in its path. Nationally, we have 75 million more barrels of crude oil than last year, which is more than enough to cover the expected production loss from the storm. National energy forecasters are predicting a 10 million barrel loss in production from storms Marco, which passed through already, and Laura.
Regardless of our national oil and natural gas supply, it is important we remember that this storm will move through numerous neighborhoods and local business centers. We will keep the residents in Louisiana and all other affected states in our thoughts during this time and hope the storm causes minimal damage.