Published: Mon, September 04, 2017
Economy | By Melissa Porter

Colonial Pipeline Partially Shuts Down

That caused a gas shortage, which caused prices to skyrocket for weeks. So how much of this is true?

As refineries turned off the lights, pump stations and terminals also were submerged by Harvey's days-long deluge, and operators such as Valero and Shell had no choice but to stop sending fuels.

Harvey, the strongest storm to hit the US since 2004, is throwing the energy market into disarray, leading to multiple refinery shutdowns in the Port Arthur, Beaumont and Houston areas, as plants further west restart. However, location is key here.

It's a combination of factors which culminated in the shut down of ten Gulf Coast oil refineries. Since the nation leans pretty heavily on Texas refineries, any disruption will be widespread.

When things get back to normal, there will be strong demand for both crude oil and refined products.

The US's new status as an energy powerhouse has created a more flexible, diverse, and arguably resilient world fuel market...

In September 2016, a leak and gas spill in Alabama that closed the Colonial Pipeline led to days of empty gas station pumps and higher prices in Alabama, Georgia, Tennessee and the Carolinas. American drivers can expect prices to continue to rise as supply chains are disrupted by Harvey's after-effects.

Firefighters are due to begin a door-to-door search of badly flooded areas of Houston on Thursday, to rescue survivors who are still stranded and recover the bodies of those who have died. Folks in the Triangle are already seeing a price increase.

Similarly, traders have booked tankers to deliver jet fuel, diesel and gasoline from Asia and even Australia to the West Coast of the United States and Mexico, despite the huge distance across the Pacific, according to shipping data. Conversely, Delaware and other eastern states might see an uptick at the pump. Why?

This includes the Colonial Pipeline, which starts in Houston and supplies much of the East Coast. DE may be more than 1,000 miles away, but so is its fuel source.

Refiner Phillips 66 said on Sunday that it requested a Jones Act waiver to its Alliance refinery in Louisiana, but the petition was still pending. They were at $2.59 a gallon on Saturday, according to motorists advocacy group AAA, 16.7 percent higher on average than a year ago.

At least 20 tankers were booked to load European fuels for the USA since Harvey made landfall, a rate almost double the average for August, shipping data compiled by Bloomberg show. "Many may not be able to go with that increase". "I passed one gas station that's $2.44 in Cary, so this one (on South Saunders Street) is the cheapest I've seen", said Ken Bond as he was filling up at $2.31.

Like this: