Gulf of Mexico Hurricanes Seen As Long-Term Drag on U.S. Oil Production

Frequent hurricanes and tropical storms in the Gulf of Mexico are preventing the U.S. from developing new oilfields, further increasing the country’s dependence on foreign oil, according to a new report. The report, by the Canadian investment bank CIBC World Markets, said the problem is not so much the temporary evacuation of oil rigs or closure of refineries. Rather, repeated storms since Hurricane Katrina in 2005 are an impediment to exploring and developing new fields. The report said that three years after Katrina, Gulf of Mexico production has not returned to pre-2005 levels. And while the U.S. Department of Energy is optimistically forecasting production of 2 million barrels of oil a day in the gulf, the CIBC report predicted that gulf production will fall to 1 million barrels a day by 2013 ”“ a third lower than pre-2005 production. This means that, even if Congress does allow drilling in the Arctic National Wildlife Refuge, that oil will not make up for declining output in the Gulf of Mexico.