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EIA Report on Hurricane Impacts on U.S. Energy 


 As of Saturday, September 13, 4:00 pm     See current        


U.S. Oil and Natural Gas Market Impacts


Prices
NYMEX Futures Prices
(for October delivery)

9/12/2008
Pre-Gustav 8/29/2008 change Week Ago
9/5/2008
Year Ago
9/12/2007
  WTI Crude Oil ($/Bbl)
101.18
115.46
-14.28
106.23
79.91
  Gasoline RBOB* (c/gal)
276.96
285.42
-8.46
268.61
201.60
  Heating Oil (c/gal)
293.91
319.19
-25.28
298.28
221.91
  Natural Gas ($/MMBtu)
7.37
7.94
-0.57
7.45
6.44
*RBOB = Reformulated Blendstock for Oxygenate Blending (RBOB), the base gasoline that needs to be blended with some type of oxygenate, now usually ethanol, to be turned into finished reformulated gasoline (RFG). Ethanol is not blended into the gasoline mixture until just before the gasoline is shipped to the retail stations.

Petroleum
As of 12:30 pm EDT (11:30 am CDT), September 13, the Minerals Management Service was reporting that 1.3 million barrels per day (or almost 100 percent) of the federal portion of the Gulf of Mexico’s crude oil production was shut-in.  As of 10:00 am EDT (9:00 am CDT), September 13, the Department of Energy reported that there are 14 refineries in Texas that are shut down ahead of Hurricane Ike.  These 14 refineries have a total capacity of nearly 3.8 million barrels per day, and represent over 1.4 million barrels per day of gasoline output and nearly 1.0 million barrels per day of distillate fuel output, based on recent historical data.  At this time, it is unclear how long these refineries will remain shut down.  So far, since refineries first shut down before Hurricane Gustav, over 21 million barrels of products have not been produced, including about 10 million barrels of gasoline and 7 million barrels of distillate fuel. This does not even include reduced production from refineries that have reduced runs at various times during Hurricanes Gustav or Ike.  As of September 13, 9 refineries were running at a reduced rate.

As of 1:15 pm on September 13, the Louisiana Offshore Oil Port (LOOP) had resumed limited operations from its Clovelly storage facility, but tanker offloadings remain suspended.  As of September 13, the Colonial product pipeline is reportedly partially shut down and the Plantation pipeline is running at reduced rates.  Both of these are major product pipelines going from the Gulf Coast to the East Coast.

Until there is better information on how long facilities in the Gulf of Mexico region will be down, it is unclear what impact Hurricane Ike will have on prices.  As of Friday, September 12, prior to Hurricane Ike’s landfall, oil prices remained well below pre-Hurricane Gustav levels, with petroleum infrastructure shutdown prior to Hurricane Gustav returning to normal operations and without any reports of significant damage to any petroleum facilities.  Compared to prices before Hurricane Gustav, crude oil for October delivery settled over $14 per barrel lower, while gasoline (RBOB) and heating oil were over 8 cents and 25 cents per gallon lower, respectively, at the close of trading on Friday, September 12.  However, with Hurricane Ike now expected to make landfall shortly, spot prices have increased recently, especially for gasoline.  Over the last 2 days of trading, the RBOB October futures contract is up nearly 11 cents per gallon.

Natural Gas
As of 12:30 pm EDT (11:30 am CDT), September 13, the Minerals Management Service was reporting that nearly 7.3 billion cubic feet per day (or almost 100 percent) of the federal portion of the Gulf of Mexico’s natural gas production was shut-in. The Department of Energy (DOE) reported that as of 10:00 am EDT (9:00 am CDT) September 13, there have been no reports of any significant damage to natural gas pipelines or production infrastructure, however major offshore pipelines are shut in or operating at less than 25 percent of normal levels.  As mandatory evacuations are lifted, operators will begin the process of assessing the condition of facilities and systems and determine when normal operations can resume.  The Sabine Pipeline reported late on September 12 that Henry Hub, the key point for spot and futures natural gas trading in the United States, is shut down because of the storm surge and intermittent power outages cased by Hurricane Ike.  As of 10:30 am EDT (9:30 am CDT) September 13, 28 natural gas processing plants (with total capacity of over 13 billion cubic feet per day) are shut down and will not resume operations until plant inspections are complete, upstream supply and downstream facilities are operational, and electricity service is restored. There are 39 major natural gas processing plants in the path of Hurricane Ike with a total operating capacity of over 17 billion cubic feet per day.



Also see:
Hurricane Situation Reports from DOE's Office of Electricity Delivery & Energy Reliability
STEO Hurricane Analysis (pdf)

 

 

Hurricane Ike’s Path
as of 0700 EDT, September 13, 2008
maps courtesy of iMapData and Pennwell

Gulf of Mexico Oil & Natural Gas Facts
Energy Information Administration
Gulf of Mexico
Total U.S.
% from
Gulf of Mexico
Oil (million barrels per day)
  Federal Offshore Crude Oil Production (4/08)
1.35
5.16
26.15%
  Total Gulf Coast Region Refinery Capacity (as of 1/1/08) 
7.41
17.59
42.12%
Natural Gas (billion cubic feet per day as of 2007)
  Federal Offshore Marketed Production
7.67
NA
NA
  State Offshore Marketed Production
0.67
NA
NA
  Total
8.33
54.7
15.22%

State Energy Profiles
Louisiana
Mississippi
Texas



Archives
Hurricane Gustav & Ike
September 12, 2008 Report
September 11, 2008 Report
September 10, 2008 Report
September 9, 2008 Report
September 8, 2008 Report
September 5, 2008 Report
September 4, 2008 Report
September 3, 2008 Report
September 2, 2008 Report
September 1, 2008 Report

Previous EIA Hurricane Reports