Hurricane Nate shuts down almost 90% of the Gulf of Mexico

Brent crude oil

Oil production were in slow drip in the Gulf of Mexico this weekend as energy companies halted off the taps and evacuated workers as a precaution for Hurricane Nate.

More than 92 percent of the crude oil output was offline due to the nation’s offshore production hub as of Sunday morning, according to the U.S. Bureau of Safety and Environmental Enforcement. Energy companies also discontinued operation by nearly 78 percent of natural gas production, the bureau estimated.

The storm developed into a hurricane on Friday night and strengthened as is passed through the central Gulf of Mexico, before making landfall near the mouth of Mississippi River. U.S. producers shut down about 300 of the 737 offshore platforms in the Gulf of Mexico to avoid potential damage.

Most of the infrastructures had emerged from the storm without any damage and production at offshore platforms could soon resume. The National Hurricane Center downgraded Nate to a post-tropical cyclone as it moved out of the area.

U.S. oil inventories have been falling which is helping to drain the global oversupply, but hurricane Harvey contributed to several weeks of stocks increase last month. The U.S. crude prices were up by 35 cents to trade at $49.64 on Monday, coming off the worst weekly loss for the commodity since June.

National average gasoline prices is expected to fall towards $2.40 a gallon, as Nate only impacted a small portion of U.S. Gulf Coast refining capacity.

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