Reports say a number of key Texas refineries are working to reopen or resume normal operations a week after Hurricane Harvey knocked out nearly one quarter of the US refining capacity and sent gasoline prices to two-year highs, just as the International Energy Agency (IEA) still sees no need for a coordinated international release of oil stocks.
While much of the region’s refining infrastructure still remained offline from Harvey, the restarts are seen as first steps in alleviating concerns about US fuel supplies.
Exxon Mobil said it was restarting its 560,500 barrel per day (bpd) facility in Baytown, Texas, the second-biggest US oil refinery, after it was inundated by flooding, according to Reuters.
Phillips 66 also indicated that it was working to resume operations at its 247,000 bpd Sweeny refinery as well as its Beaumont terminal.
The announcements are coming after Valero Energy said late Friday it was ramping up production at its Corpus Christi, Texas-area refineries, as well as evaluating its 335,000 bpd Port Arthur, Texas, refinery for damage from Harvey.
Retail gasoline prices have risen more than 17.5 cents since August 23, before Harvey hit, amid worries the storm would trigger supply shortages. Pump prices were at $2.59 a gallon on Saturday, according to motorists advocacy group AAA, up three percent from Friday and 16.7 percent higher on average than a year ago.
In another positive sign for the industry, Occidental Petroleum said it had loaded and shipped the first crude cargo from its Ingleside terminal in Corpus Christi after Hurricane Harvey first made landfall.
The Port of Corpus Christi, a major energy industry shipping hub, was partially open and hoped to resume normal operations early this week, officials said.
Nearly half of US refining capacity is in the Gulf Coast region, an area with proximity to plentiful supplies from Texas oil fields to Mexican and Venezuelan oil imports. The majority of Texas ports remained closed to large vessels, limiting discharge of imported crude.
However, Paris-based IEA, which coordinates energy policies of industrialized nations, said it was monitoring the situation in Texas and Louisiana to assess the hurricane’s impact on oil and gas markets and was in very close contact with US authorities.
“To date, market mechanisms and government assistance have been adequate. The IEA stands ready to act as required,” it said in a statement.
“There are high levels of stocks in the affected regions and in the United States as a whole. These stocks are being supplemented by imports of gasoline to the East Coast of the United States and the US Secretary of Energy has taken action to ease localized crude oil shortages in Texas by providing crude oil loans from the US Strategic Petroleum Reserve.”
Frontpage January 24, 2019