Re­fin­ery clo­sures likely to spur rise in gas prices

Austin American-Statesman Sunday - - HURRICANE HARVEY - By David Koenig

DAL­LAS — Key oil and gas fa­cil­i­ties along the Texas Gulf Coast have tem­po­rar­ily shut down be­cause of Trop­i­cal Storm Har­vey, vir­tu­ally as­sur­ing gaso­line prices will rise in the storm’s aftermath.

Even be­fore Har­vey made land­fall as a hur­ri­cane, dozens of oil and gas plat­forms had been evac­u­ated, at least three re­finer­ies had closed and at least two petro­chem­i­cal plants had sus­pended op­er­a­tions.

How soon they re­open de­pends on the sever­ity of flood­ing and the re­sump­tion of power to the ar­eas. Ex­perts say it’s still too early to say, with the storm still mov­ing through the re­gion. But they believe gas prices will in­crease 5 cents to 25 cents per gal­lon.

Har­vey also con­tin­ued to take a toll on U.S. air travel Satur­day, with more than 960 flight can­cel­la­tions as of mid­day, ac­cord­ing to FlightAware. Nearly 800 of those can­celed flights were sched­uled to ei­ther de­part from or land at Hous­ton’s two air­ports.

The ship­ping in­dus­try also is ex­pected to be dis­rupted by the worst hur­ri­cane to hit the re­fin­ery-rich Texas coast in more than 50 years.

For most of the na­tion, the oil in­dus­try im­pact might be the big­gest issue.

Nearly one-third of the na­tion’s re­fin­ing ca­pac­ity sits in low-lying ar­eas along the coast from Cor­pus Christi to Lake Charles, La.

Sev­eral re­finer­ies at great­est risk of suf­fer­ing a di­rect strike from high winds had al­ready shut down, but it is the potential for flood­ing in the Hous­ton and Beau­mont ar­eas that could re­ally pinch gaso­line sup­plies.

Flood­ing and power out­ages caused by a storm surge are con­sid­ered the big­gest risk.

“The big­gest driver of how much this will in­crease gas prices is how much rain falls in Hous­ton dur­ing the next three days,” Andy Lipow, pres­i­dent of con­sul­tant Lipow Oil As­so­ci­ates, said Satur­day. “We are in a wai­t­and-watch mode.”

For now, Lipow is pre­dict­ing gaso­line prices will rise 10 cents per gal­lon east of the Rock­ies.

Tom Kloza, an an­a­lyst for the Oil Price In­for­ma­tion Ser­vice, pre­dicts that prices could rise by up to 25 cents a gal­lon but that an in­crease of 5 cents to 15 cents is more likely, as­sum­ing that Har­vey doesn’t cause last­ing dam­age to re­finer­ies.

Flint Hills Re­sources an­nounced that it would shutter a re­fin­ery be­fore Har­vey hit, and Valero En­ergy Corp. said it was clos­ing two fa­cil­i­ties in Cor­pus Christi.

The prospect of supply in­ter­rup­tions sent gaso­line fu­tures to $1.74 a gal­lon, their high­est level since April, be­fore they re­treated to about $1.67 by Fri­day af­ter­noon.

In ad­di­tion to the re­fin­ery clo­sures, For­mosa Plas­tics shut its petro­chem­i­cal plant in Point Com­fort and OxyChem sus­pended op­er­a­tions at its petro­chem­i­cal plant in In­gle­side, ac­cord­ing to Platts, an S&P Global di­vi­sion that tracks the com­modi­ties and en­ergy in­dus­try.

Com­pa­nies evac­u­ated work­ers from oil plat­forms in the Gulf of Mex­ico, and that is crimp­ing the flow of oil and gas.

We Are Blood, the sole provider of blood to Cen­tral Texas hos­pi­tals, is ex­pe­ri­enc­ing a short­age of blood types O-neg­a­tive and O-pos­i­tive.

Do­na­tion locations are in Austin at 4300 N. La­mar Blvd. and 3100 W. Slaugh­ter Lane, and in Round Rock at 2132 N. Mays St., Suite 900.

With school start­ing, La­bor Day week­end ap­proach­ing and the potential for se­vere weather in the area, the need for the two blood types is an­tic­i­pated to con­tinue through the next two weeks.

The two blood types are most the im­por­tant be­cause of their uni­ver­sal ten­den­cies. Type O-neg­a­tive blood is the uni­ver­sal blood type and can be trans­fused into any pa­tient. Type O-pos­i­tive blood is the more com­mon blood type, which means many Cen­tral Texas pa­tients can re­ceive it.

Peo­ple who do­nate, or at­tempt to do­nate, at any cen­ter or mo­bile drive will re­ceive a free P. Terry’s milk­shake voucher through Mon­day. Donors must be in good health, at least 17 years old and weigh at least 115 pounds.

The Texas Di­a­per Bank is also in need of do­na­tions to pro­vide emer­gency di­a­per kits to evac­uee fam­i­lies. Do­nate on­line at tex­as­di­a­per­ and des­ig­nate funds to disas­ter re­lief.


A Valero oil re­fin­ery’s flare con­tin­ues to burn as Hur­ri­cane Har­vey makes land­fall in Cor­pus Christi on Fri­day. But some re­finer­ies shut down.

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