Summary:
- Hurricane Isaias Landfall Forecasted For Late Friday/early Saturday
- Major US Refineries In Hurricane’s Projected Path
- 63% Of US Offshore Gulf Oil Output Shut
- 25% Of US Offshore Gulf Oil Output Shut As Hurricane Isaias Nears, Threatens Refineries
Hurricane Isaias Shutters 63% of US Gulf Oil Production
Bloomberg cites data from the Marine Minerals Administration showing US Gulf offshore oil producers have halted about 1.28 million barrels per day, equivalent to shutting in 63% of regional output.
Natural gas shut-ins reached 1.127 billion cubic feet a day, equivalent to 57% of the region’s production.
By noon Central Time, workers from 121 offshore platforms had evacuated, while four rigs had moved outside Hurricane Isaias’ cone of uncertainty.
This is a massive temporary hit to US crude supply. For NatGas, the national production impact is much smaller.
The next big issue is that refineries may see a decline in crude supply as offshore platforms reduce flows. Any refinery outage from storm-related damage would reduce fuel product production as a global refining crisis deepens.
Major Refineries In Crosshairs
Jefferies consumer staples analyst Kaumil Gajrawala warned clients ealrier today: “Hurricane Isaias is a fuel supply event hitting a system already stretched by the Iran war. ~25% of Gulf crude output is shut in (~4% of US production), but fuel inventories are low and diesel is $6.30 vs. $3.68 a year ago. A small disruption now has outsized price consequences. The second-order effect is freight cost, which favors asset-light models like KO (Buy), where bottlers carry the fleet and fuel exposure.”
As we noted earlier today, any abrupt westward shift in the hurricane’s cone of uncertainty would put major refineries at risk, including Chevron’s Pascagoula refinery on Mississippi’s Gulf Coast. It refines 369,000 barrels of crude a day into gasoline, diesel, jet fuel, and premium base oils.
Landfall impacts for portions of Louisiana, Mississippi, Alabama, and the Florida Panhandle are expected late Friday into Saturday morning.
25% Of US Offshore Gulf Oil Output Shut As Hurricane Isaias Nears, Threatens Refineries
Hurricane Isaias forced offshore oil and natural gas producers in the Gulf of America to halt a sizable amount of production as the Atlantic’s first hurricane of the season churned toward the coast, with potential landfall impacts across portions of Louisiana, Mississippi, Alabama, and the Florida Panhandle.
Isaias had sustained winds of 75 miles per hour and was about 460 miles south-southwest of the Mississippi River mouth overnight, according to the National Hurricane Center.
Producers with offshore rigs have already shuttered 25% of crude output and 16% of NatGas production and evacuated workers from eight platforms and two rigs.
Models increasingly point to landfall late Friday night or early Saturday morning east of major energy assets onshore and offshore in Mississippi and Louisiana.
An abrupt westward shift in the hurricane’s cone of uncertainty would put major refineries at risk, including Chevron’s Pascagoula refinery on Mississippi’s Gulf Coast. It refines 369,000 barrels of crude a day into gasoline, diesel, jet fuel, and premium base oils.
The disruption to offshore oil and NatGas rigs comes as a global refining crisis deepens, and there is little room for error in the US, as refineries operate near full capacity.
Enki Research risk modeler Chuck Watson said that oil and NatGas outages would likely last no more than a week if the forecast track holds.
Tyler Durden
Thu, 10/08/2026 – 15:17
