Business | Oil & Gas
Hurricane Dolly forces refining cuts and hits output in Texas
Hurricane Dolly slowly steamrolled into Texas on Wednesday, cutting production at some oil refineries but sparing most offshore oil and natural gas production facilities in the Gulf of Mexico.
- Reuters
- Published: 23:37 July 24, 2008
Houston: Hurricane Dolly slowly steamrolled into Texas on Wednesday, cutting production at some oil refineries but sparing most offshore oil and natural gas production facilities in the Gulf of Mexico.
The disruptions were not enough to stem a fall in oil prices, which are down more than $20 in the steepest dollar drop in the market's history from the record above $147 hit July 11.
"Dolly has not deviated much from its forecast path," said Olivier Jakob, an oil analyst at Petromatrix. "Its price impact potential should now be discounted."
Late on Wednesday, BP Plc said it returned offshore operations to normal and ExxonMobil said 12,000 bpd in oil and 100 mmcfd natural gas output remained shut.
Producer Anadarko said it was returning workers to two platforms that produce the equivalent of 20,000 bpd in oil while Apache said shut production increased to 115 mmcfd in gas output from 56 mmcfd on Tuesday.
As of Wednesday morning, energy companies in the Gulf of Mexico had shut 4.5 per cent of the region's oil production and 7.9 per cent of its gas output, according to the US Minerals Management Service.
That reflected a small increase in crude production and small decrease in gas production from Tuesday, according to the MMS report - though energy analysts said they expected a complete recovery in a matter of days.
Hurricanes in 2005 temporarily shut all of the Gulf of Mexico's oil and gas production, pushing oil prices to then-record highs. The region can produce 1.3 million barrels per day of crude, or a quarter of domestic oil output, and 7.7 billion cubic feet per day of natural gas, or 13 per cent of domestic gas output.
Meanwhile, the storm's disruption to shipping around Houston forced at least one refining company to slow down fuel output because of the interruption of cargoes.
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