Stories tagged with "Hurricane Ike"

Gas Shortages?: This Week in Petroleum - September 24

Gasoline shortages are starting to become a problem in the Southern US in areas such as Nashville and Atlanta. This week's "This Week in Petroleum" (TWIP) (included in its entirety under the fold) did indeed show a big drop in gasoline inventory as we expected, but we are still digesting the impact, keeping in mind that these are averaged numbers over four weeks--which of course begs the question of whether or not the full impact of the refinery outages we have seen are in these numbers or not.

In this post, I have prepared a few graphs to supplement this week's TWIP. We know that Hurricane Gustav and Hurricane Ike had a huge impact on refineries, and that these production shortfalls are now slowly making their way through pipelines. It is my view that because Texas refineries have been fairly slow to get back online, and because of the built-in lag due to the slow travel of refined products through pipelines, the present gasoline shortages are likely to get worse in the next two to three weeks.

How Much Will Gustav and Ike Affect Gas Supplies? An Update.

Shortly after Hurricane Ike hit, I wrote an article called Implications of a Ten-Day Refinery Outage. It is a few days later, and we know a little more. The purpose of this article is to give an update on the situation.

Based on what I am seeing now, we are likely to see significant gasoline outages in the next few weeks. These may not be as long-lasting as those with Katrina, but they may temporarily be more severe, at least in some parts of the country. Diesel may or may not be a problem. We are an exporter of diesel, so can theoretically reduce exports if need be. Also distillate (used for diesel) supplies are currently at a more adequate level than are gasoline supplies. Jet fuel stocks seem to be at a relatively adequate level, so shortages may not be a problem.


Figure 1. EIA Weekly Gasoline Stocks (includes blending stocks)

As one can see from Figure 1, EIA weekly gasoline stocks are diving, on a path to 180 million barrels of gasoline or less, in the next week. Weekly gasoline supplies when Katrina hit in 2005 declined, but not nearly to the extent we are seeing today.

POLL: CLV08 went through $91/bbl..so, in the next 60 days, the front month price of CL will...

hit $100 before it hits $82
33% (584 votes)
hit $82 before it hits $100
34% (586 votes)
stay in a trading range between $82 and $100
22% (382 votes)
it's still all geopolitics and other "above ground factors," so what does a price signal mean anyway?
5% (80 votes)
it's all about the varying dollar value and speculation...why bother?
7% (117 votes)
Total votes: 1749

Implications of a Ten Day Refinery Outage

Where is our gasoline and diesel supply headed? Even before Ike hit, quite a few areas of the US were starting to see gasoline shortages. The impact of Ike can only make shortages worse. Most likely, it will take refineries at least a week or two to get production back to normal levels after a storm of this type, considering the impacts of electrical outages and flooding. In this article, I will examine some of the issues that seem to be involved. Based on my analysis, fuel supply shortages are likely to last well into October, and are likely to get considerably worse before they get better.

Insight 1. Even before Hurricane Ike hit, inventories were very low.


FIgure 1. EIA Graph of Gasoline Inventories

According to EIA data, gasoline inventories the week that Hurricane Gustav hit were the lowest that they had been since 2000, amounting to 187.9 million barrels, or about 21 days supply. Quite a bit of this inventory is needed just to keep the pipelines filled. EIA does not publish information as to how far inventories need to drop before we start seeing outages, but it is clear that we have now reached the point where shortages are developing.

Damage Caused by Hurricane Ike - Open Thread

We are only now beginning to be able to assess in real time what damage Hurricane Ike has caused to oil structures and other property. We are hearing of flooding, electrical outages, damages to oil platforms and pipelines, among other things. This thread is for discussing these issues.

According to today's DOE report, 3.6 million barrels of refinery capacity is shut in, and 2.5 million barrels is operating with reduced runs. In my refinery article, I used an estimate of one-third of production from reduced runs being off line. With this approach, 4.4 million barrels of refinery production is off-line, which is about 22% of oil products use. The corresponding calculation from yesterday's report would indicate that 4.5 million barrels were offline then, so we are making slight progress. It would be difficult to get along without 22% of oil products for long, however.

Also, from that report, there are 3.9 million electricity customers without electrical power, including 2.4 million from Texas.

The report indicates that 1.3 million barrels of crude oil production is off-line. The US produced a total of about 5.1 million barrels of crude oil a day, including all of the United States. The amount currently off-line amounts to about 25% of US production.

Let us know what other information you see and hear.

Hurricane Ike, Energy Infrastructure, Refineries and Damage Models Landfall Thread (Updated 9/13 18:00 EDT)

Updated 9/14 900 EDT. Hurricane Ike made landfall in Galveston in an area with extensive oil infrastructure, namely over 5 million bpd of US petroleum refining capacity. (5 MMBBL is about 30% of US capacity (about 15 MMBBL), and a bit less than 6% of global capacity (~85 MMBBL)).

Our thoughts and prayers go out to those affected by this storm. We would ask that you please keep this thread on point with Hurricane Ike and energy-related articles, stories, maps, data, and links in the comments.

(Graphics and damage forecasts moved below the fold for bandwidth and spacing...it's all still there...this continues to be the thread to accumulate resources as of 9/14.)

Hurricane Ike, Energy Infrastructure, Refineries and Damage Models Thread #4 (Updated 9/12 23:00 EDT)

(Welcome: we are now on a later and more updated thread, which can be found here: http://www.theoildrum.com/node/4525 NB: you may want to just go the front page (it will be post #1 or #2) to get to the most recent thread: http://theoildrum.com ...)

(all the maps and models moved under the fold to conserve bandwidth...scroll down)

Updated 9/12 2300 EDT--next update in the morning when we know more about where and how much power/wind was involved. Hurricane Ike's current track currently is headed directly for Houston/Galveston and is expected by the National Hurricane Center to be Category 2 (or perhaps a 3) at a late Friday/early Saturday am landfall, which remains in striking distance of over 5 million bpd of US petroleum refining capacity. (A little perspective: 5 MMBBL is about 30% of US capacity (about 15 MMBBL), and a bit less than 6% of global capacity (~85 MMBBL)).

The concern now is the where of landfall. If the storm continues further west before turning (see Chuck's update below), then Texas City/Baytown will be in a very bad place, and that's >1MMBBL all by itself. The next two maps represent the current NHC track (the further "left" the storm goes the worse it is for TX City and Baytown, note red storm surge in this track, Baytown is at the back of the bay) and the GFDL track below...as of this update the eye was wobbling to the left of the NHC track, which isn't a good thing for Texas City.

(all the maps and models moved under the fold to conserve bandwidth...scroll down)

POLL: CLV08 went through $102/bbl..so, in the next 60 days, the front month price of CL will...

hit $113 before it hits $91
35% (1050 votes)
hit $91 before it hits $113
30% (923 votes)
stay in a trading range between $91 and $113
25% (754 votes)
it's still all geopolitics and other "above ground factors," so what does a price signal mean anyway?
5% (160 votes)
it's all about the declining dollar and specs...
5% (147 votes)
Total votes: 3034

Hurricane Ike and Oil Refineries/Infrastructure Damage Models Thread #3 (21:00 EDT 9/11)

(Welcome: we are now on a later and more updated thread, which can be found here: http://www.theoildrum.com/node/4525 NB: you may want to just go the front page (it will be post #1 or #2) to get to the most recent thread: http://theoildrum.com ...)

Hurricane Ike's current track predicts landfall within 100 miles of Galveston Saturday morning; but the storm isn't strengthening much yet and the track has been moving northwards--so, because of the wobbles in the track, models are still uncertain. Within the current NHC storm path lies over 5 million bpd of US petroleum refining capacity. (Perspective: 5 MMBBL is about 30% of US capacity (about 15 MMBBL), and a bit less than 6% of global capacity (~85 MMBBL). Also, the MMS reported Wednesday that staff has been evacuated from 452 production platforms (63.0%) and 81 rigs (66.9%) – (95.9% of the oil production and 73.1% of the natural gas production has been shut-in as a precautionary measure for Hurricane Ike.)

Hurricane Ike and Oil Refineries/Infrastructure Thread #2 (9/10 16:30 EDT)

(Welcome: we are now on a later and more updated thread, which can be found here: http://www.theoildrum.com/node/4525 NB: you may want to just go the front page (it will be post #1 or #2) to get to the most recent thread: http://theoildrum.com ...)

Hurricane Ike's current track predicts landfall between Corpus Christi and Galveston, but has been moving northwards. Within the current NHC storm path lies about 5 million bpd of US petroleum refining capacity. (Perspective: 5 MMBBL is about 30% of US capacity (about 15 MMBBL), and a bit less than 6% of global capacity (~85 MMBBL). Also, the MMS reported Wednesday that staff has been evacuated from 452 production platforms (63.0%) and 81 rigs (66.9%) – (95.9% of the oil production and 73.1% of the natural gas production has been shut-in as a precautionary measure for Hurricane Ike.)