By Florence Tan

SINGAPORE (Reuters) – Oil prices dropped for a second straight session on Monday as U.S. producers began restoring output after Hurricane Delta weakened, while a strike that had affected production in Norway came to an end.

Brent crude <LCOc1> for December fell 55 cents, or 1.3%, to $42.30 a barrel by 0023 GMT and U.S. West Texas Intermediate <CLc1> for November was at $40.08 a barrel, down 52 cents, or 1.3%.

Front-month prices for both contracts gained more than 9% last week, the biggest weekly rise for Brent since June, but fell on Friday after Norwegian oil firms struck a wage bargain with labour union officials, resolving a strike that threatened to cut the country’s oil and gas output by close to 25%.

“We had good support for both Brent and West Texas on the back of some supply concerns,” said Michael McCarthy, chief market strategist at CMC Markets in Sydney.

“Given that the hurricane season in the U.S. has just started, there’s potential for that to keep prices firm.”

In the United States, Hurricane Delta, which dealt the greatest blow to U.S. offshore Gulf of Mexico energy production in 15 years, was downgraded to a post-tropical cyclone by Sunday.

Workers headed back to production platforms on Sunday while Total SA <TOTF.PA> continued restarting its 225,500 barrel-per-day Port Arthur, Texas, refinery on Sunday.

However, Colonial Pipeline, the largest oil products pipeline in the United States, shut its main distillate fuel line after the hurricane disrupted power, the company said on Sunday.

(Reporting by Florence Tan; Editing by Kenneth Maxwell)

Source Article

By Erwin Seba

HOUSTON (Reuters) – U.S. energy companies were returning workers and restarting operations at storm-swept production facilities along the U.S. Gulf Coast on Sunday, two days after Hurricane Delta barreled through the area.

Chevron Corp, Royal Dutch Shell Plc and BHP Group all said workers were headed back to production platforms in the U.S.-regulated northern Gulf of Mexico.

BHP expects to complete the return of workers to its Shenzi and Neptune production platforms on Sunday, spokeswoman Judy Dane said, adding that resuming flows will depend on how quickly pipelines return to service.

It can take several days after a storm passes for energy producers to evaluate facilities for damage, return workers and restore offshore production. The companies that operate oil and gas pipelines and process the offshore output also shut ahead of the storm.

On Sunday, the U.S. Bureau of Safety and Environmental Enforcement (BSEE) said 91% of offshore crude oil production remains shut in the U.S.-regulated northern Gulf of Mexico following Hurricane Delta, which made landfall on Friday night.

In addition, 62.2% of natural gas output remains shut in the Gulf following the storm that made landfall near Creole, Louisiana, and weakened into a low-pressure system over Mississippi on Saturday.

Through Sunday, a cumulative total of 8.8 million barrels per day (bpd) of crude oil production and 8.3 billion cubic feet per day of natural gas output from the Gulf has been shut because of Hurricane Delta.

The area produces about 17% of total daily U.S. oil production and 5% of daily natural gas production.

Still remaining shut are the Calcasieu Waterway in Calcasieu and Cameron Parishes in Louisiana and the ports of Lake Charles and Cameron, Louisiana, near where Delta made landfall.

The ports of Beaumont and Port Arthur, Texas, including the Sabine Pass, which serve

HOUSTON (Reuters) – U.S. energy companies were returning workers and restarting operations at storm-swept production facilities along the U.S. Gulf Coast on Sunday, two days after Hurricane Delta barreled through the area.

Chevron Corp, Royal Dutch Shell Plc and BHP Group were returning workers to production platforms in the U.S.-regulated northern Gulf of Mexico, the companies said.

BHP expects to complete the return of workers to its Shenzi and Neptune production platforms on Sunday, spokeswoman Judy Dane said, but resuming flows will depend on how quickly pipelines return to service, she said.

It can take several days after a storm passes for energy producers to evaluate facilities for damage, return workers and restore offshore production. The companies that operate oil and gas pipelines and process the offshore output also shut ahead of the storm.

Cumulative volumes shut-in by Hurricane Delta through Sunday, according to company reports to the U.S. government, amounted to 8.79 million barrels of oil and 8.30 billion cubic feet of natural gas.

The area produces about 1.8 million barrels of oil per day, or 17% of total daily U.S. output, and 5% of daily U.S. natural gas production.

Still remaining shut are the Calcasieu Waterway in Calcasieu and Cameron Parishes in Louisiana and the ports of Lake Charles and Cameron, Louisiana, near where Delta made landfall Friday evening.

The ports of Beaumont and Port Arthur, Texas, including the Sabine Pass, which serve major oil and liquefied natural gas processing plants, were reopened with restrictions on Sunday, the U.S. Coast Guard said.

Total SA continued restarting its 225,500 barrel-per-day Port Arthur, Texas, refinery on Sunday. The refinery, which is about 65 miles (100 km) west of Creole, Louisiana, where the storm went ashore, lost power on Friday.

Fast-moving Delta swept over Louisiana on Saturday and became a low-pressure

HOUSTON (Reuters) – Hurricane Delta raked across the Gulf of Mexico, halting most of the region’s offshore oil output on Thursday after energy companies shut-in wells, pulled staff from offshore platforms and began securing coastal processing plants.

The storm was about 370 miles (595 km) south of Cameron, Louisiana, and grinding toward the Louisiana coast at 13 miles per hour (21 km per hour). Its tropical storm-force winds extend up to 125 miles from the storm’s center, the National Hurricane Center said.

Delta is expected to intensify further over the Gulf’s warm waters and become a major hurricane with winds of 115 miles per hour (185 kph) before landfall in southwest Louisiana by Friday evening.

Oil producers withdrew workers from 279 offshore facilities and moved 15 drilling rigs away from Delta’s winds. They have shut 1.69 million barrels per day of oil, or 92% of the region’s offshore oil, and 1.67 billion cubic feet per day, or nearly 62% of its natural gas output.

Energy prices rose on the shut-ins and prospect for a new U.S. economic stimulus. U.S. crude oil futures were up 3% at $41.21, natural gas futures and gasoline futures both rose 2.6%. Natural gas futures reversed course after suffering losses.

“It is going to be a large, powerful storm,” said Weatherbell Analytics meteorologist Joe Bastardi. Delta will land just east of Cameron, Louisiana, an area still suffering the impact of Hurricane Laura’s 150 mph winds.

Total SA

also began shutting a small oil-processing unit at its Port Arthur, Texas, refinery, people familiar with plant operation said. Cameron LNG closed its natural gas processing plant ahead of the storm’s arrival.

Offshore producers including Royal Dutch Shell

, BP

, Chevron

and Occidental Petroleum

have pulled workers from production platforms to quarters onshore.

The unusually high number of

HOUSTON (Reuters) – A strengthening Hurricane Delta dealt the greatest blow to U.S. offshore Gulf of Mexico production in 15 years, halting most of the region’s oil and nearly two-thirds of its natural gas output.

An already large and powerful storm, Delta could intensify further on Friday as it churns through the Gulf’s prime oil-producing area. Its winds reached 120 miles per hour (195 kmh), according to the National Hurricane Center.

Delta has shut 1.67 million barrels per day, or 92% of the Gulf’s oil output, the most since 2005 when Hurricane Katrina destroyed more than 100 offshore platforms and hobbled output for months.

Oil prices eased in early trading in Asia on Friday, but were on track for gains of about 10% for the week, boosted by outages in the Gulf of Mexico and a labor dispute in the North Sea. The two combined have removed 3.17 million barrels per day from the market.

Workers had evacuated 279 offshore Gulf of Mexico facilities and producers moved 15 drilling rigs away from Delta’s large and strong windfield. Tropical force winds stretched up to 160 miles from its center, the NHC said, a sign of its large size.

Delta will decrease as it approaches the coast but is expected to remain a Category 3 storm on the 5-step Saffir-Simpson scale. It will bring a 4- to 11-foot (1.2-3.3 meters) storm surge to the coast near landfall, the NHC said.

In addition to oil, producers have halted nearly 62% of the region’s natural gas output, or 1.675 billion cubic feet per day. Offshore Gulf of Mexico fields produce about 15% of U.S. crude oil and 5% of its natural gas production.

Total SA on Thursday began shutting an oil processing unit at its 225,500 barrel-per-day (bpd) Port Arthur, Texas, refinery because of