At least 3.6 million barrels per day of refining capacity are offline in Texas and Louisiana, or almost 20 percent of total USA capacity, based on company reports and Reuters estimates.
It could also takes weeks for companies to fully complete damage assessments – especially since more rain is on the way.
Harvey, the most powerful hurricane to strike the USA mainland since 2005 and to hit Texas since 1961, roared onto the state’s Gulf Coast late Friday as an immensely powerful category four hurricane.
But Magellan Midstream Partners, which runs several oil and fuel pipelines into and out of Houston, has suspended many of its operations.
With the storm still churning in the Gulf, as well as the time needed to assess damage and enact repairs, the impact to gasoline and fuel oil prices could be severe.
The worst impact on the USA supply of gasoline and other fuels may yet be to come. Ike forced more than a dozen refineries to close, largely due to flooding. USA traded crude-oil futures were off 0.5% at $47.42 a barrel. That price was lately 24 cents above benchmark futures, traders said. Retail prices slowly increased by 4 cents in the last week to $2.38 a gallon, according to auto club AAA.
The Texas coast is home to almost 30% of US refining capacity and Houston-area plants account for roughly half of that.
Spokesperson for the nation’s largest oil company Motiva Enterprises, in Port Arthur, Texas said the state-owned oil company of Saudi Arabia was dealing with restrictions in the flow of crude oil coming in and gasoline being relased through pipelines and ports. There’s still no official explanation of the odor, which lingered for more than two days, but a slew of reports filed by various area refineries certainly provide some clues as to where it came from. The 459,000-bpd Galveston Bay Refinery in Texas City, Texas, 45 miles (72 km) south of Houston, has flooding in its tank farm and on nearby streets, the sources said.