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Hurricanes batter US oil production plants

Storms batter Texas and Florida to devastating effect.

Hurricane Harvey

Harvey hits Texas Image: Commons

First up was Hurricane Harvey - the first major hurricane to make US landfall since Wilma in 2005.  Harvey, which hit Texas on 26th August as a Category 4 Hurricane, brought record rainfall and winds as it tore across the state.

In all, the storm left more than $70bn worth of damage in its wake and claimed 72 lives.

The impact on the oil industry was catastrophic, forcing Exxon Mobil to shut down its Baytown plant on the Houston Ship Channel and significantly cut production at its Beaumont site. Shell closed its 335,000bpd Deer Park Refinery in South Houston, with Petrobras and Phillips 66 following suit.

Distribution was also severely disrupted, with Magellan shutting down its pipeline out of Houston, hampering all major refinery production. The Port of Corpus Christi also closed for business as a 449ft drill ship broke its moorings and blocked the channel entrance.

By the time Harvey had moved on, some 22% of Gulf of Mexico production had be "shut-in" and between 20 and 25% of total US refining capacity had been disrupted.

Around six days later oil prices had picked up as supplies re-started, although around 1.2m gallons of daily gasoline supply was still offline - equating to the estimated combined consumption of California, Oregon and Washington.

But Mother Nature was not finished, as only days later Hurricane Irma destroyed several Carribean Islands before turning its attention to Florida.  The resulting damage, although less severe than Harvey by the time it made landfall, again seriously impacted oil and fuel supplies; paralysing tanker transportation and shutting down some 6,000 service stations.

Tags: base oil, Lubes marketing, N America

Published 12th September, 2017

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