Norway’s Equinor has halted operations at its Titan platform in the Gulf of Mexico, according to Reuters. This decision comes after the evacuation of non-essential personnel in response to a Tropical Cyclone System heading toward Florida, which is expected to strengthen into a major hurricane by Thursday.
Despite these precautionary measures, oil prices fell sharply on Wednesday, dropping nearly 3% by 12:36 p.m. ET. This decline is attributed to uncertainty over China’s economic stimulus and rising U.S. stockpiles.
Reports earlier on Wednesday indicated that the immediate threat to oil platforms in the Gulf of Mexico had diminished. This has somewhat alleviated concerns about potential supply disruptions from a region that contributes around 14% of all U.S. oil and gas production and over half of the country’s processing capacity.
In addition to Equinor, other major companies like Shell and Chevron also evacuated personnel from offshore facilities earlier this week. Chevron completed its evacuation on Monday, removing non-essential staff from several platforms, including Anchor, Big Foot, Blind Faith, Jack, Petronius, and Tahiti. Shell started preparations to shut down two of its platforms, Stones and Appomattox, on Sunday.
Storm Helene is currently moving east, with the National Hurricane Center predicting it will develop into a Category 3 hurricane shortly. It is expected to strengthen by the end of Wednesday and make landfall in Florida, which has already declared a state of emergency.
As reported by Reuters, approximately 16% of crude oil production and 11% of natural gas output have been suspended due to the storm. This translates to a loss of about 284,000 barrels per day in oil production and 208 million cubic meters in gas production.
Just two weeks ago, a hurricane passed through the Gulf, temporarily shutting down nearly 700,000 barrels per day of production and boosting oil prices. Some production facilities remained offline a week after the storm impacted Louisiana.
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