About 63% of Regional Crude Output Is Shut In as Isaias Nears

About 63% of regional crude production is shut in as Isaias approaches, with the Category 2 storm threatening to intensify before reaching the U.S. Gulf Coast late Friday or early Saturday.

About 57% of regional natural gas output is also offline. Companies have evacuated offshore platforms, moved drilling rigs and prepared for port closures that could disrupt crude deliveries to coastal refineries.

U.S. West Texas Intermediate crude rose as much as 5.6% Thursday as the storm increased pressure on offshore production and supply routes. The move comes amid a global refining crisis and constrained U.S. gasoline and diesel supplies.

Temporary outages could further tighten fuel inventories if storm damage affects refineries or reduced offshore flows limit crude supplies. The impact on national natural gas production is expected to be smaller than the effect on Gulf crude output.

About 500,000 barrels per day of refining capacity is at risk. Chevron’s Pascagoula refinery on Mississippi’s Gulf Coast is among the facilities in the storm’s projected path. The refinery processes 369,000 barrels of crude per day into gasoline, diesel, jet fuel and premium base oils.

Isaias is forecast to reach the U.S. Gulf Coast late Friday or early Saturday, when refinery access, crude flows and fuel inventories will face their next major test.