US forecasts above-normal 2025 hurricane season amid concerns about NOAA cuts

U.S. government scientists are forecasting an above-normal 2025 Atlantic hurricane season, with expectations of 13 to 19 named tropical storms, six to 10 hurricanes, and three to five major hurricanes; this is attributed primarily to warmer sea surface temperatures. Despite recent staffing and budget cuts at NOAA, officials assert that hurricane forecasting and public warnings will not be hindered, citing reliance on diverse data sources including satellites, ground observations, and hurricane hunter aircraft which improve forecast accuracy by 10-20%.

Analysis

U.S. government scientists project an above-normal 2025 Atlantic hurricane season, forecasting 13 to 19 named tropical storms, of which six to 10 are expected to become hurricanes, including three to five major hurricanes, primarily attributed to warmer sea surface temperatures. This forecast significantly exceeds the 1991-2020 annual average of 14.4 named storms and 3.2 major hurricanes. Despite recent cuts of nearly 900 employees (over 7% of its workforce) at the National Oceanic and Atmospheric Administration (NOAA) under the Trump administration’s Department of Government Efficiency, officials, including National Weather Service Director Ken Graham, assert that forecasting capabilities and public warnings will not be compromised. They cite reliance on diverse data sources such as satellites, ground observations, and hurricane hunter aircraft, the latter reportedly improving forecast accuracy by 10-20%. However, concerns persist among critics regarding the NWS's ability to monitor local conditions, particularly with methods like weather balloons. Notably, the Federal Emergency Management Agency (FEMA) was absent from the forecast briefing, a departure from past joint appearances designed to assure the public about federal preparedness. Other meteorological bodies, including Colorado State University and AccuWeather, have also issued forecasts for an above-normal season. This outlook is particularly salient given the 2024 hurricane season was one of the costliest on record, incurring $130 billion in losses and causing 427 fatalities.

Key Decisions for Investors

• Investors should assess portfolio exposure to sectors historically vulnerable to hurricane activity, including insurance, reinsurance, energy infrastructure in coastal areas like the U.S. Gulf Coast, and agriculture, given the forecast for an above-normal 2025 season.
• Monitor the operational effectiveness of NOAA and NWS throughout the season, particularly in light of significant staffing reductions, as any degradation in forecasting accuracy or warning dissemination could amplify economic and market impacts.
• Evaluate potential opportunities in companies specializing in disaster resilience, construction materials for rebuilding, and emergency response services, which may see increased demand if the hurricane season is as active as predicted.