Washington — Tropical Storm Cristobal has developed in the southern Gulf of Mexico, putting offshore drillers and Texas and Louisiana refiners on watch for potential impacts later in the week.
Receive daily email alerts, subscriber notes & personalize your experience.Register Now
Major Mexican oil facilities such as the Dos Bocas marine terminal could face rain impacts or loading delays as the storm hovers over the Bay of Campeche. Other facilities in the potential path include the 280,000 b/d Villahermosa terminal, 230,000 b/d Campeche terminal and 234,000 b/d Progreso terminal.
The US National Hurricane Center on June 2 upgraded Cristobal from a tropical depression as it moved slowly over Mexico's Bay of Campeche. A tropical storm warning is in effect for Campeche to Puerto de Veracruz.
The storm is forecast to begin moving northward across the Gulf of Mexico by this weekend, the hurricane center said. "However it is too soon to specify the location and timing of any potential impacts along the US Gulf Coast," it said, urging these areas to monitor the storm throughout the week and have hurricane plans in place.
The 2020 Atlantic hurricane season, which officially started June 1, is expected to be an active one, with 13-19 named storms, including three to six major hurricanes at least category 3 or stronger, according to the US National Oceanic and Atmospheric Administration.
For US oil, natural gas and power markets, the annual risk of hurricanes comes on top of uncertainty this year caused by the coronavirus pandemic. US and global responses have recently wreaked havoc on product supply-demand balances and could affect how the domestic industry responds to landfall of a major storm this year.
Along the US Gulf Coast, elevated product inventory levels could cushion the supply chain in the case that flooding or winds cause infrastructure damage, shuttering operations at individual refineries or other facilities.