“Obviously the Gulf is producing less oil and storms are not going to have the immediate price impact that we’ve seen in the past,” Luke Larson, vice president at LCI, said by phone yesterday.
Ike and Katrina cut more oil production than Isaac and caused more damage to offshore platforms.
Oil prices surged to $130 a barrel on Sept. 22, 2008, from as low as $90.51 six days earlier after Ike, a Category 2 storm, made landfall on Sept. 13 near Galveston, Texas, less than two weeks after Hurricane Gustav hit the region. Ike cut 21.5 million barrels of oil from Gulf production, according to the Energy Department.
Katrina, which went ashore on Aug. 29, 2005 as a Category 3 storm, curtailed 30.2 million barrels of output. Oil prices jumped to $70.85 a barrel on Aug. 30 from as low as $62.25 on Aug. 18.
The Gulf is better able to withstand storms as oil companies upgraded their facilities after Katrina. Offshore production was also in decline as the moratorium imposed after the BP Plc oil spill slowed the development of deep-water fields.
“A lot of these platforms have been upgraded after the events that we’ve seen in 2005 so they are in a better position to endure adverse weather conditions,” said Tchilinguirian. “If you would have a bearing on the market you need permanent shutdowns.”
Gulf output is forecast to fall to 1.3 million barrels a day this year from 1.56 million in 2009, according to the Energy Department. Output in the lower 48 states excluding the Gulf is forecast to grow to 4.51 million barrels a day, the most since at least 1993.
“If it had not been for that drilling moratorium, Gulf production would have been higher,” said James Williams, an economist at WTRG Economics, an energy-research firm in London, Arkansas. “It’s going to take another two or three years to get Gulf production back to where it was.”