Tuesday, August 25, 2020

"Hurricane Laura Poses Biggest Threat to U.S. Energy Since Katrina"

A bit of hyperbole in the headline.
It's going to be a big storm and disruptive to production, refining and LNG exports (tankers won't be pulling up to Cheniere for a few days) but this is not the '90's and there is upstream and downstream capacity to pick up for any shortfall.
From Reuters via gCaptain:
The U.S. energy industry on Tuesday was preparing for a major hurricane strike, cutting crude production at a rate approaching the level of 2005’s Hurricane Katrina and halting oil refining at plants along the Texas-Louisiana coast.

Officials in the two states ordered hundreds of thousands of coastal residents to flee inland as Hurricane Laura strengthened and forecasters predicted it would become a major hurricane with sustained, 115 mile per hour (185 kph) winds.
At least a 10-foot (3-meter) storm surge will likely hit the upper Texas coast later this week, said Chris Kerr, a meteorologist at agriculture, energy and weather data provider DTN. He said rapid intensification could even produce a devastating Category 4 hurricane.
Oil producers on Tuesday had evacuated 310 offshore facilities and shut 1.56 million barrels per day (bpd) of crude output, 84% of Gulf of Mexico’s offshore production, near the 90% outage that Katrina brought 15 years ago.

The storm will make landfall by early Thursday in an area that accounts for more than 45% of total U.S. petroleum refining capacity and 17% of oil production, according to the Energy Information Administration.

Refiners that produce gasoline and diesel fuel were taking steps to halt nine facilities that process nearly 2.9 million bpd of oil, 14.6% of the U.S. total capacity, according to Reuters tallies.
The impact on refineries so far is less than Hurricane Harvey, whose drenching rains took down nearly one quarter of U.S. refining capacity three years ago....

Here's the latest cone of uncertainty from the National Hurricane Center, the intensity forecast is at least a cat 3, (110 mph winds) but the storm could spin up to a cat 4 without surprising anyone:


And here are the latest tweets/retweets from our go-to hurricane guru, Ryan Maue: