Oil Outages in the Gulf of Mexico Balloon Beyond Shell

At least two other oil majors shut down their Gulf of Mexico rigs on Friday following a leak at the Fourchon booster station, cutting off the flow of crude through Amberjack pipelines.

On Thursday, Shell halted production at its Mars, Ursa and Olympus platforms, which can produce 410,000 bpd. Shell did not provide an estimate of when the rigs would resume production.

On Friday, Shell was joined by Chevron, which closed Jack/St. Malo (57,000 bpd), Tahiti and Bigfoot (75,000 bpd) platforms, which also supply the Amberjack lines. Equinor joined Shell and Chevron on Friday, shutting down its Titan rig, a minor rig in the Gulf of Mexico that typically produces just 2,000 boepd.

The Fourchon booster station, which leaked two barrels of oil before being shut down, is expected to be repaired later today. It is not yet known when the platforms will resume production.

The shutdown, which now spans seven rigs in the Gulf of Mexico, comes at a time when the United States is grappling with high retail gasoline prices and tight crude oil and fuel markets. refined products. Already, the United States has drawn on its strategic oil reserve to the tune of 800,000 and 1 million barrels per day to alleviate prices at the pump.

Crude oil inventories in the United States remain 5% below the five-year average. US crude oil production currently sits at 12.2 million barrels per day, 900,000 bpd below its pre-Covid peak.

Crude oil prices were down on Friday but still up week over week, a reality that could halt the downward trend in U.S. retail gasoline prices. The Biden administration has lobbied OPEC and Saudi Arabia specifically to increase oil production ahead of the midterm elections.

By Julianne Geiger for Oilprice.com

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