U.S. Refineries, Offshore Output Shut by Hurricane

(Bloomberg) — At least eight refineries across the U.S. Gulf Coast and almost all offshore oil output have been shut as companies including Valero Energy Corp.,ConocoPhillips and Exxon Mobil Corp. prepare for Hurricane Gustav’s arrival.

About 10 percent of U.S. oil-refining capacity is off line, and five sites are operating at reduced rates. More than 96 percent of offshore oil output and 82 percent of gas production is shut, the U.S. Minerals Management Service said.


Gustav, a Category 3 hurricane, was about 170 miles (275 kilometers) south-southeast of New Orleans, packing winds of 115 miles an hour, the National Hurricane Center said. It may reach Louisiana as early as midday with a force “not very different” from its current strength, the center said in its latest advisory.

“Flooding is inevitable and so would be power supply cuts even if hurricane damage is minimal,” said Anthony Nunan, assistant general manager for risk management at Mitsubishi Corp. “If there’s a big stoppage, it will depend on how long any shutdown will be for prices to react.”

Bloomberg