US Energy Dept releases 500000 barrels from strategic reserve

Other estimates have put the economic losses from Harvey at under $100 billion.

Exxon, meanwhile, also temporarily shuttered a massive plant in Baytown, Texas, with a capacity of more than 560,000 barrels per day, according to reports from CNBC. Crude inventories are 14.5 percent below record levels hit in March.

Federal officials should release fuel from the Strategic Petroleum Reserve to prevent gas prices from rising in the wake of Hurricane Harvey, Democratic Senator Edward Markey from MA told President Donald Trump in a letter on Wednesday.

Tropical Storm Harvey inflicted more damage on the heart of the USA energy industry on Wednesday, churning into Louisiana after flooding the biggest U.S. refinery in Texas, causing major fuel pipelines to Midwest and East Coast markets to suspend operations and threatening to squeeze supplies across the country for weeks.

Texas is home to 5.6 million barrels of refining capacity per day, and Louisiana has 3.3 million barrels.

“It means if something goes wrong it’s a big impact”.

After shifting over the Gulf of Mexico late Monday, Harvey is now expected to regain strength before crashing ashore today near Port Arthur, Texas, where Motiva Enterprises LLC operates the largest U.S. refinery.

According to GasBuddy, the national average US gas price Thursday morning was $2.46/gal, up 4.6 percent from its average price a week ago.

Global benchmark Brent crude settled $1.52 higher, or 2.99 percent, at $52.38 a barrel.

The U.S. Northeast was already dealing with reduced supply.

Brent crude’s premium to WTI widened to the largest in two years with the global benchmark trading at as much as $5.20 above the US marker.

While the refineries were shut off as a precaution for the storm, flood damage has occurred at some facilities.

Gasoline margins RBc1-CLc1 climbed, as the gasoline crack spread jumped to $24.02 a barrel early in the session, the highest on a seasonal basis since 2012.

“I don’t know how long it’s going to take to get those (refineries) back on”, Perry told reporters on Thursday aboard Air Force Two with Vice President Mike Pence. Refiners still open are running like mad to close the gasoline deficit and the higher prices that come with that demand.

Harvey made landfall as a Category 4 hurricane late Friday, but was downgraded to a tropical storm by mid-Saturday. The storm is preventing ocean tankers from delivering competing loads of imported foreign crudes in Houston but it is also interfering with some of the 400,000 barrels of Canadian crude normally delivered daily to the Gulf Coast, about 11 per cent of Canada’s total oil exports.

The nationwide average right now, she said, is $2.40 per gallon.

At a Fort Worth Costco, customers were greeted with pre-hurricane prices, just a fraction over $2.06 per gallon.

Goldman also said around 1.4 million bpd of crude production was disrupted, equivalent to 15 percent of total USA output.

The effects of the damage and shutdowns are expected to ripple for weeks. Half of Texas’s refining capacity is equivalent to roughly 2.75 million barrels per day.

Traders have shrugged off weekly inventory data on Wednesday, which showed stocks prior to the hurricane.

The Department of Energy hopes the release of 500,000 barrels of reserve crude will offset the fuel shortage and stabilize prices.