OIL & GAS

Hurricane Activity Spares US Gulf Coast Oil Patch

The US Gulf Coast oil and natural gas fields have been fortunate this year as the active Atlantic hurricane season has spared them from major storms.

By Donna Joseph
Oct 23, 2023 1:57 AM Updated October 23, 2023
Hurricane Activity Spares US Gulf Coast Oil Patch Photo by SBR

The US Gulf Coast oil and natural gas fields have been fortunate this year as the active Atlantic hurricane season has spared them from major storms. This stroke of luck has saved energy companies billions of dollars in losses and prevented consumers from facing higher fuel costs.

The 2023 Atlantic hurricane season has seen above-average activity, with six hurricanes and three major hurricanes with winds exceeding 111 mph (179 kph) out of a total of 20 named tropical storms.

Fortunately, only one storm, Tropical Storm Harold, disrupted operations at three refineries in Corpus Christi, Texas, for just one day due to power outages.

This has been the most significant impact on the Gulf Coast oil industry this year. The Gulf of Mexico offshore operations contribute 15% of US crude oil production and 5% of the nation's natural gas production. Additionally, about half of the country's refining capacity and natural gas processing plant capacity are located along the Gulf Coast.

"We got really, really lucky this year," said Colin White, a consultant with Rystad Energy in Houston. However, he emphasized that producers still need to consider the inherent risk associated with the region.

While the hurricane season officially ends on November 30, meteorologists believe that the season is gradually winding down. Jim Foerster, chief meteorologist for DTN, described this season as a powerhouse. So far, offshore production has not been affected this year. 

While refiners have traditionally welcomed low-activity hurricane seasons due to the avoidance of crude supply disruptions, he notes that the energy system is evolving, with reduced global production of oil and gas leading to higher feedstock costs. As a result, the benefits of a milder hurricane season may not be as significant for refiners and consumers as they once were.


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