|SThis graph shows the dramatic decline in U.S.
refinery distillate production in the final week in September when the
refinery outages had reduced crude input by over 4 million barrels per day.
That’s a reduction of about 25% of crude input, and distillate production
fell a similar 25% from a normal level of over 4 million barrels per day to 3
million barrels per day -- a drop of
over 1 million barrels per day.
|SThe plot also shows the impact of Ivan in
2004. But the hurricane decline was greater this year from Katrina and Rita,
and the production volume will only again reach 4 million barrels per day at
the end of October or early November. For the month of October, distillate
production is estimated to be about 400 thousand barrels per day below what
it would have been if the hurricanes had not damaged the Gulf Coast
|SWhile we lump heating oil and diesel together
when we talk about distillate, the products are not interchangeable. The Gulf
Coast refineries produce high fractions of diesel fuels and provide almost
all the diesel needs of the markets in Southeastern U.S., which may mean that
the lost diesel production impacts are disproportionately reflected in the