Highlights

• The National Oceanic and Atmospheric Administration (NOAA) predicted above-normal hurricane activity in its Atlantic Hurricane Season Outlook released on May 22, 2008. NOAA projects 12 to 16 named storms will form within the Atlantic Basin, including 6 to 9 hurricanes, of which 2 to 5 will be intense during the upcoming hurricane season (June 1 – November 30).

• Above-normal hurricane activity in the Atlantic is likely to correspond to increased impacts on offshore crude oil and natural gas producers in the Gulf of Mexico. However, the range of potential production outages is quite extensive, depending on the severity of the weather in the producing region.

• Based on the results of a Monte Carlo hurricane outage simulation, which is conditional on how NOAA's most recent predictions for the level of Atlantic basin hurricane activity compare to historical activity, EIA expects a total of about 11.3 million barrels (bbls) of crude oil and 78 billion cubic feet (Bcf) of natural gas to be shut in during the 2008 hurricane season.

• The simulation results indicate only a less-than-1-percent probability of experiencing seasonal outages similar to 2005 when Hurricanes Katrina and Rita struck the Gulf Coast, i.e., cumulative shut-in production of more than 100 million bbls of crude oil or 600 Bcf of natural gas. Conversely, EIA projects the chance that offshore production in the Federally-administered Gulf of Mexico will be impacted this year is 98 percent for both crude oil and natural gas.