Last updateThu, 19 Oct 2017 5pm


Harvey Cutting Off Chemical Supply to Manufacturers

“Shutdowns at specialty chemical plants along the Texas Gulf Coast caused by Tropical Storm Harvey threaten to snarl supply chains across the United States,” CNBC reports.

“Roughly 40% of the U.S. petrochemicals market was offline as of Tuesday morning as Harvey continued to drench the region” and 37% of “total U.S. ethylene production has been disrupted since August 21, according to live monitoring by ICIS.” 

Nearly One-Quarter of U.S. Fuel Output Shut, And Harvey Isn't Done

The heart of the U.S. energy industry has suffered considerable damage from Tropical Storm Harvey and supply constraints could last for weeks with nearly one-quarter of U.S. fuel output knocked out.

Harvey's disruption has driven gasoline futures prices up nearly 17% since August 23, as a total of 4.2 MMb of U.S. refining capacity has been shut down. The latest shutdowns, carried out on Tuesday evening and on early Wednesday, were in Port Arthur, and included the nation's largest refinery. Restarts following a storm are often the most dangerous times for refiners.

Shale production has also been sharply curtailed in the Eagle Ford region of Texas and major pipelines carrying fuel to Midwest and East Coast markets have been either throttled back or shut entirely. 

Midwest Refiners to Capitalize as Harvey Hits Gulf

“U.S. refiners in the Midwest will be among the biggest winners after Hurricane Harvey dealt a blow to their competitors on the U.S. Gulf Coast,” Reuters reports.

“The U.S. refining industry enjoyed strong margins in recent weeks and the fallout from the hurricane is likely to extend the bullish run for weeks. Midwest refiners have the added advantage of pricing their fuel based on benchmark prices in the Gulf Coast markets, which hit five-year highs on Monday.” 

Duke Energy Cancels Nuclear Plans in Favor of Solar

Duke Energy Florida filed a revised settlement agreement that includes $6 billion in investments in solar energy, smart meters and grid modernization projects. The company will also no longer move forward with building the Levy Nuclear Project on the Gulf Coast, following the recent Westinghouse bankruptcy announcement, and customers will not pay any further costs associated with the project. With this cancellation, Duke Energy no longer has plans for any new nuclear projects. 

Texas Oil & Gas Activity Up for Eighth Straight Month

Sizable year-over-year improvements in the rig count, drilling permits, and the value of Texas-produced crude oil and natural gas, along with renewed industry employment growth combined to push the Texas Petro Index upward in July to 176.9, the eighth straight monthly increase since a 24-month contraction.

“Oil and gas producers in Texas and across the U.S. responded swiftly to wellhead price increases that occurred when OPEC and other oil-producing nations agreed to curb output to fight excessive supplies on world oil markets,” said Karr Ingham, the economist who created the index. 

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