2025 Hurricane Season Threatens the Oil and Gas Industry

The 2025 hurricane season, from June 1 to Nov, 30, is shaping up to be notably active. The National Oceanic and Atmospheric Administration (NOAA) projects a 60% chance of an above-normal Atlantic hurricane season, forecasting 13 to 19 named storms, including 6 to 10 hurricanes and 3 to 5 major hurricanes which are category 3 or higher. Additionally, sea surface temperatures in the Gulf of Mexico are nearly 2°F above historical averages, which can fuel more intense and rapidly strengthening storms.

Hurricane disruptions in the Gulf of Mexico continue to pose significant risks to offshore oil and gas production, as well as onshore refining and export operations. In high-impact scenarios, monthly crude oil outages can reach 1.5MMb/d in the United States, with similar refinery input losses, potentially driving gasoline prices up.

The US Energy Information Administration (EIA) indicates that in 2024, storm-driven unplanned outages averaged around 295Mb/d of crude oil and 0.2Bcf/d of natural gas in September, representing 16% and 11% of Gulf of Mexico’s federal production, respectively. Such disruptions can reverberate through global energy markets affecting LNG exports, petrochemical feedstocks, and refined products distribution.

Mexico is also very vulnerable to hurricanes on both coasts, with past storms inflicting sharp production losses. The most recent example is Hurricane Otis, which devastated Acapulco in late 2023, resulting in economic losses estimated at up to US$16 billion, making it the most expensive hurricane in the country’s history. The storm caused widespread damage to critical infrastructure and severely disrupted operations in the energy and transportation sectors.

Beyond natural disasters, structural and financial stresses compound the risks. PEMEX, already beset by declining production, reaching its lowest levels since the late 1970s, continues to struggle to maintain operational resilience. These challenges stem from aging assets, insufficient maintenance caused by spending constraints, and the company’s mounting debt. 

In response to Otis, PEMEX implemented emergency measures to stabilize fuel supply, particularly for Guerrero and the port of Acapulco. The company ensured gasoline and diesel inventories sufficient for 18 days of consumption and arranged for delivery of additional fuel via tanker ships, though recovery was hampered by ongoing power outages in affected regions.

Service companies that support offshore operations have also raised alarms. In mid-2025, a coalition of service providers warned of widespread operational disruption unless PEMEX settles its invoices; delayed payments of more than US$25 billion to firms performing critical work were putting future production and supply continuity at risk.

Looking ahead, the outlook for Mexico’s side of the Gulf of Mexico remains concerning for 2025, with both national and international forecasts indicating heightened tropical activity that could significantly impact coastal regions and offshore energy operations. Mexico’s National Weather Service (SMN) projects between 13 and 17 total named storms in the Atlantic basin this year, which includes the Gulf area, with an estimated seven to nine becoming tropical storms of moderate strength and an additional three to four maturing into Category 3, 4, or 5 hurricanes. These projections reinforce the reality that Mexico’s Gulf coast and offshore energy infrastructure remain at elevated risk of disruption, intensification, and storm-related damages as the season progresses toward its peak between mid-August and mid-October.