Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/272980 
Year of Publication: 
2022
Series/Report no.: 
Bank of Canada Staff Working Paper No. 2022-36
Publisher: 
Bank of Canada, Ottawa
Abstract: 
Do technological improvements mitigate the potential damages from extreme weather events? We address this question using oil production and hurricane data from the Gulf of Mexico. We show that hurricane activity lowers well production and that stronger storms have larger impacts that persist for months after impact. Hurricanes also significantly increase the probability that oil assets are stranded, particularly when the hurricanes pass within 50km of an oil rig's location. Regulations enacted in 1980 that required improved construction standards for rigs in the Gulf only modestly mitigated the short-run production losses caused by hurricanes. The 1980 regulatory reforms also modestly decreased the probability that leases permanently exited production.
Subjects: 
Business fluctuations and cycles
Climate change
Potential output
JEL: 
C22
C23
Q40
Q48
Q54
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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