Hurricane Harvey ravages a third of US refining outputAdd bookmark
The most violent storm in more than a decade has left the world’s largest crude oil refining nation reeling
In the wake of the first major hurricane to make landfall since 2005, the buckling of US energy infrastructure has sent shockwaves throughout the nation and gasoline prices soaring.
An estimated $100bn of damage has been wreaked by the category four Atlantic storm as it swept up through southern Texas and onto the Houston metropolitan area, the state’s oil and gas hub.
Five of the ten largest oil refineries in the US are based in Texas, and the largest of these, Saudi Aramco’s Motiva facility in Port Arthur was closed due to flooding.
Part of the 8,850km Colonial Pipeline, which transports three million barrels per day of fuel from the Gulf Coast to New York was shut down due to refinery closures.
Refining and offshore capital
Houston represents the majority of US domestic refining capacity at 45 per cent of the country’s total, and gasoline prices have spiked countrywide since the hurricane.
The national average price for a gallon currently stands at $2.52, some 17 cents higher than the day before Harvey struck.
Futures prices for gas rocketed by 10 per cent in the immediate aftermath of Harvey’s devastation before easing down on Friday as pumping is expected to resume shortly.
In addition to onshore resources, offshore production in the Gulf of Mexico accounts for one fifth of US crude oil output.
Rigs were evacuated and mobile units were repositioned as Harvey swept into the Gulf through the Caribbean Sea.
During the onslaught of Hurricane Katrina in 2005, 115 platforms were destroyed and 52 others damaged as production in the Gulf was halted for a number of weeks.