Support the fact-based journalism you rely on with a donation to Marketplace today. Give Now!

Record hurricane season could hurt oil and gas production

Elizabeth Trovall May 28, 2024
Heard on:
HTML EMBED:
COPY
The concentration of oil refineries along the Gulf Coast makes them especially vulnerable to big storms. Brandon Bell/Getty Images

Record hurricane season could hurt oil and gas production

Elizabeth Trovall May 28, 2024
Heard on:
The concentration of oil refineries along the Gulf Coast makes them especially vulnerable to big storms. Brandon Bell/Getty Images
HTML EMBED:
COPY

With a record number of hurricanes expected to barrel through the Atlantic Ocean this year, the oil and natural gas industry is particularly at risk, according to new analysis from the U.S. Energy Information Administration.

The concentration of oil refineries along the Gulf Coast makes them especially vulnerable to big storms.

“The Gulf Coast by itself has about half of America’s total refining capacity,” said Mark Finley, the fellow in energy and global oil at Rice University’s Baker Institute.

The facilities are crucial to consumers in the U.S. and beyond. “Gulf Coast refineries are also the reason why the United States is the largest exporter of refined products like gasoline and diesel fuel on the planet,” he said.

Those storms can knock out refinery capacity for months, economist Jesse Thompson of the Federal Reserve Bank of Dallas noted.

“Over that time, you know, all else being held equal, the outages would put some slight upward pressure on prices of crude oil and natural gas,” he said.

Americans could see gas prices spike, according to Karr Ingham with the Texas Alliance of Energy Producers.

But “unless market fundamentals are altered by this — which is most often not the case — that should be a very short-term impact,” he said.

Eventually, affected refineries would get back to business as usual.

There’s a lot happening in the world.  Through it all, Marketplace is here for you. 

You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible. 

Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.