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Global Oil Market on Edge Ahead of OPEC+ Meeting

Global Oil Market on Edge Ahead of OPEC+ Meeting

The global oil market awaits…

China’s Iron Ore Imports Expected to Hit Record High This Year

China’s Iron Ore Imports Expected to Hit Record High This Year

A recent Reuters report quoted market analysts…

Record-Breaking Hurricane Season Took Major Toll On Gulf Of Mexico Production

On Thursday morning, Tropical Storm Eta made landfall over North Florida and has become the 12th named storm to make landfall out of a record-breaking year of 29 named storms.

Eta Making Landfall Over North Florida 

An unprecedented amount of tropical systems have swirled around the Atlantic Basin this year, breaking the 2005 record of 28. The above-average tropical activity has decimated the oil and gas industry with offshore operations in the Gulf of Mexico. 

According to Bloomberg, some 41 million barrels were pulled offline because offshore oil and gas rigs were shuttered due to tropical activity. 

"Between tropical storm Cristobal in early June and the latest Greek alphabet soup of tempests disrupting oil platforms in the Gulf, offshore drillers have had to shut about 41 million barrels of production, the most in government data going back to 2010." 

Gulf of Mexico production cuts equates to about 270k barrels per day, or about the same production rate as OPEC member Republic of Congo. The reductions come when U.S. crude inventories are already swollen as crude product demand collapsed because of the virus pandemic. 

Tropical Cyclones Shut A Record Amount Of Oil Output From Gulf Of Mexico

"Production fell in August mainly because hurricanes disrupted production from the Gulf of Mexico," the Energy Information Administration's Short-Term Energy Outlook stated this week. "EIA reported that U.S. crude oil production in the Gulf of Mexico averaged 1.2 million b/d in August, down 0.5 million b/d from July."

Slumping crude product demand is expected to continue as the resurgence of the virus pandemic is already resulting in new restrictions that will limit mobility in the US.

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With hurricane season ending in Nov.30, this could lead to production coming back online across the Gulf of Mexico, which would further pressure crude prices. 

By Zerohedge.com

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  • George Doolittle on November 12 2020 said:
    Not a reliable source for an article but still GOM oil can produce oil profitably at a very low price ($8-10 bucks a barrel US possibly lower) and in volume. I don't think this is true anywhere else on Earth as far as Offshore Oil work is concerned.

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