Hurricane Sally is shifting from offshore oil fields within the US, heavy rainfall to curb gasoline demand

© Reuters. FILE PHOTO: Hurricane Sally impacts New Orleans


From Erwin Seba

HOUSTON (Reuters) – Hurricane Sally crawled off the coast of the U.S. Gulf Coast on Wednesday, pulling away from the oil fields, while the region was drenched in heavy rains that could dampen fuel demand in the southeastern U.S.

The hurricane halted more than a quarter of oil and gas production in the US offshore Gulf of Mexico and moved heavy seas that closed ports from Louisiana to Florida. It was moving at a snail's pace towards a landing on the coast between Mississippi and Florida on Wednesday.

While Sally's intensity waned, it remained a Category 1 hurricane with 140 km / h wind. Oil and chemical ports along the Mississippi have reopened with restrictions, and some offshore operators were preparing to bring workers back to offshore platforms on Thursday.


Nearly 500,000 bpd of offshore crude oil production and 759 million cubic feet per day (mmcfd) production have ceased in the US Gulf of Mexico, according to the US Department of the Interior.

Crude oil prices in Asian trading were higher Wednesday, extending the previous day's gains on shutdowns, and an industry report forecast a decline in US crude oil inventories. Oil futures () () rose about 1.5% after rising more than 2% on Tuesday.

The National Hurricane Center warned Sally that 25 to 50 inches of rain could fall, and in some places up to 30 inches of rain. It warned of life-threatening flash floods along the coast between Mississippi and the Florida Panhandle.

Sally's slow crawl will continue after landing, leaving up to 6 inches of rain as far as Atlanta by Friday, said Jim Foerster, chief meteorologist at weather data provider DTN. "It will be a catastrophic flood" for much of the southeastern United States, he said,

The rain is forecast to spread to Alabama, Georgia and South Carolina through Friday, cutting travel expenses and dampening fuel demand in the southeast.

US gasoline inventories rose 3.8 million barrels last week. That emerges from data released Tuesday by the American Petroleum Institute trading group, which exceeded analysts' expectations in a Reuters poll for a draw of 160,000 barrels.

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