Oil Majors Cut Production in Gulf of Mexico as Tropical Storm Strengthens

Dow Jones
6 hours ago
 
 

Oil companies operating in the Gulf of Mexico have begun curbing production and evacuating personnel from offshore facilities as the region braces for Tropical Storm Isaias.

The storm is intensifying and is expected to have strengthened to a powerful hurricane by the time it makes landfall Friday, the National Hurricane Center said.

Chevron said Wednesday that it has begun shut-in procedures at four of its assets in the Gulf, which the U.S. now calls the Gulf of America, and is evacuating all associated personnel. Production at its five other facilities in the Gulf remains at normal levels, it said.

Shell said it is halting production and evacuating personnel at five of its sites, and has moved nonessential personnel from another. British peer Harbour Energy, which entered the Gulf through its takeover of LLOG Exploration in December last year, said in an emailed statement it too has begun cutting production and evacuating personnel at select facilities. BP said it is removing nonessential personnel offshore facilities.

Oil prices rose Thursday in part due to growing U.S. offshore production shut-ins as the storm approaches the northern Gulf Coast. Escalating Houthi militant attacks in Saudi Arabia and tanker strikes in the Persian Gulf area are also weighing on the energy markets. December Brent crude futures rose 2.6% to $102.79 a barrel, while December West Texas Intermediate futures gained 2.2% to $89.46 a barrel

Oil companies operating in the Gulf are used to temporarily cutting production and evacuating personnel from their rigs given the frequency of storms in the region.

The U.S. Marine Minerals Administration said 511,619 barrels a day, or 25% of current Gulf production, had been shut in as of midday Wednesday.

 
 

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