Hurricane Barry made landfall over the weekend, hitting the Louisiana as a Category 1 storm. The short-lived hurricane brought heavy rain and flooding to the Gulf Coast. There were mandatory evacuations, but no fatalities were associated with the first hurricane of the season. But as the season begins, the energy industry is faced with the annual need to prepare for what could happen if a big storm hits.
Matt Smith, director of commodity research at ClipperData, says the impact of Barry on the energy industry was minimal, though companies took a number of precautions just in case.
“Seventy percent of Gulf of Mexico oil production, which is nearly 1.4 million barrels per day, [came] offline,” Smith says, along with 60% of natural gas production. Smith expects producers to bring their facilities back online soon now that the danger has passed.
Smith says projections for this year’s Atlantic hurricane season, which runs through November, call for 12 named storms, including six hurricanes – three of them major.
“Even though it’s expected to be a normal season, there’s some potential there for serious hurricanes coming through,” he says.
Aside from the risk of storms, geopolitical tensions are currently affecting gasoline prices, Smith says, with Texas pump prices up to $2.50 per gallon.
Written by Shelly Brisbin.