More than a quarter of offshore oil and gas production in the US Gulf of Mexico remained shut on Wednesday as Hurricane Sally crept inland, bringing winds and heavy rains while hampering fuel demand in the US Southeast. The National Hurricane Center said Sally weakened to a tropical storm at 4 PM CDT (2100 GMT) after making landfall as a Category 2 hurricane in Alabama early Wednesday.
The US Interior Department said the hurricane prompted shut-ins of 508,000 bpd of oil production and 805 Mmcfd gas output in the US Gulf of Mexico. The storm also contributed to a 5% surge in gasoline futures RBc1 and US crude CLc1 on Wednesday.
A spokesperson with Chevron said it maintained operations at its 350,000 bpd Pascagoula refinery in Mississippi. Royal Dutch Shell conducted an initial assessment at its chemical plant and refinery in Mobile, Alabama, and reported no severe damage. Shell also cut production at its 227,400-bpd refinery in Norco, Louisiana. Phillips 66 said it halted processing at its 255,600-bpd Alliance refinery in Louisiana, noting that it would advance maintenance at the facility.
According to the US Energy Department, about 1.1 million bpd of refining capacity in the US Gulf Coast were shut on Wednesday. This included two plants under repair since Hurricane Laura in late August and another stopping processing due to coronavirus-induced weak demand.
