The first major hurricane of the year has come and gone without causing any significant supply disruptions, leading oil prices to fall back on Tuesday morning.
The landfall of Hurricane Beryl led to three casualties in Texas, leaving more than 2 million Houston homes without power, but first reports suggest damage to oil infrastructure has been limited.
– Since making landfall near the coastal town of Matagorda, Beryl has weakened to a tropical storm and is forecast to move across eastern Texas and into the lower Mississippi Valley later in the week.
– Freeport LNG went offline for two days, the only major export terminals to be shut for Hurricane Beryl, sending US LNG feedgas demand to 11.1 BCf per day on July 8, down from the pre-hurricane level of 13.1 BCf per day.
– The port of Corpus Christi reopened Monday afternoon after a three-day halt in operations, whilst the port of Houston is expected to return to the status quo ante Wednesday after officials confirm there is no large-scale material damage.
Market Movers
– US shale producer Devon Energy (NYSE:DVN)announced it would purchase the Williston-focused firm Grayson Mill Energy in a transaction valued at $5 billion, lifting its oil output to 375,000 b/d.
– Italy’s energy major ENI (BIT:ENI) made a hydrocarbon discovery in Mexico’s Sureste Basin, located in Block 9 and potentially containing 300-400 MMboe of recoverable reserves.
– UK-based energy major Shell (LON:SHEL) is seeking the South African government’s permission to drill up to 5 offshore wells off the country’s west coast, to the south of its prolific Namibia discoveries.
The oil markets have withstood the first hurricane test of this season, with oil prices falling back on Tuesday morning. Apart from shipping delays and platform evacuations, Hurricane Beryl seems to have led to relatively little physical damage to refineries and offshore platforms, most probably allowing the markets to focus again on fundamentals and geopolitics later this week.
OILPRICE.COM