US gasoline prices surge as Harvey keeps refiners shut

It is getting harder to fill gas tanks in parts of Texas where some stations are out of fuel and pump costs are spiking. (AP)
Updated 01 September 2017

US gasoline prices surge as Harvey keeps refiners shut

HOUSTON: Retail US gasoline prices hit two-year highs and global shipping routes were scrambled as the nation’s largest refiners remained shut on Friday, even as Storm Harvey lost strength.
Major fuel pipelines feeding the US Northeast and Midwest were either closed or severely curtailed, prompting shortages in some areas and dramatic spikes in wholesale prices.
The storm, which began as a hurricane a week ago, has roiled global fuel markets, and tankers carrying millions of barrels of fuel have been rerouted to the Americas to avert shortages. European refining margins hit a two-year high amid the surge in exports.
Indeed, the effects of the storm will continue for several weeks, if not months, after Harvey hammered the Gulf Coast for days and brought floods that buried Houston and the surrounding area in several feet of water. It knocked out about 4.4 million barrels of daily refining capacity, slightly more than Japan uses daily, and the signs of restarts were tentative.
The nation’s largest refiner, Motiva’s Port Arthur facility, which can handle 600,000 barrels of crude daily, will be shut for at least two weeks, according to sources familiar with plant operations.
In Corpus Christi, where Harvey first made landfall, refiners Citgo Petroleum, Flint Hills Resources and Valero Energy, were moving to restart their plants, along with the nearby Valero Three Rivers refinery, according to sources.
Benchmark US gasoline prices have surged more than 15 percent since the storm began, but in trading Friday, the contract for October delivery lost 1 percent, the first decline in five days. September’s contract had risen by 25 percent, but stopped trading Thursday.
US crude prices continued to slump along with demand, with the futures contract falling 0.4 percent to $47.02 a barrel.
The national average for a regular gallon of gasoline rose to $2.519 as of Friday morning, according to motorists advocacy group AAA, with even gaudier increases in the US Southeast, which relies heavily on Gulf supplies.
South Carolina, for instance, has seen prices rise nearly 30 cents, and prices were up nearly 20 cents in Texas, where fuel shortages were already evident.
Suppliers in the Chicago area were taking steps to prevent shortages, and banking on hope.
Dave Luchtman, owner and president of Lucky’s Energy Service, a small distributor in Chicago, has rented two storage trailers that hold 8,000 gallons each, expected to be delivered Friday.
“So I have a little lifeline,” Luchtman said.
Refineries so far have not given any indication that there are fuel shortages, said Mario Orlandi, an operations manager at Olson Service, which supplies diesel and gasoline to the Chicago area.
“Cross our fingers, keep our tanks full,” Orlandi said.
The global impact of the storm was being felt in Venezuela, where financially strapped state-run PDVSA is facing the possibility that scheduled deliveries — tankers floating offshore for weeks due to non-payment — will make their way to other Latin American destinations.
At least two cargoes scheduled to deliver to Venezuela currently in the port of Curacao are now expected to be delivered to Ecuador.
Mexico, Brazil, Colombia and other countries want to tap some of the 7 million barrels of fuel sitting in the Caribbean sea, according to three traders and shippers.
European and Asian traders have diverted millions of barrels of fuel to the Americas. That included a rare opportunity for exports of jet fuel from Europe to the United States, reversing the usual flow of shipments.
Supplies from distant markets may not arrive soon enough to avert a crunch after the Colonial Pipeline, the biggest US fuel system, said it would shut part of its main lines to the Northeast.
“We are going to have outages from Texas to Boston,” said one East Coast market source. The market is “way under-appreciating the magnitude of this.”
Several East Coast refineries have run out of gasoline for immediate delivery as they sent fuel elsewhere, and concerns over shortages ahead of the US Labor Day extended weekend were mounting.


First tanker to load crude at Libya’s Hariga port since January

Updated 23 September 2020

First tanker to load crude at Libya’s Hariga port since January

  • The Delta Hellas tanker will enter Libya’s Hariga port on Wednesday and load 1 million barrels of oil from the port’s storage

BENGHAZI/LONDON: An oil tanker is expected to load crude at Libya’s Marsa el-Hariga terminal this week, the first since a blockade by eastern forces in January slashed the OPEC member’s oil production to a trickle.
The Delta Hellas tanker will enter Libya’s Hariga port on Wednesday and load 1 million barrels of oil from the port’s storage, the Arabian Gulf Oil Co. which operates the port said in a statement.
Eastern Libyan commander Khalifa Haftar said last week his forces would lift their eight-month blockade of oil exports, which depressed the OPEC member’s production down to around 100,000 barrel per day (bpd).
Trading arm of China’s Sinopec , Unipec- which prior to the blockade was one of the main lifters of Mesla and Sarir crude grades from the terminal- booked the tanker, two trading sources said.
Unipec also booked the Marlin Shikoku tanker, which according to Refinitiv Eikon shipping data is expected to arrive at Hariga on Thursday.
This comes as the National Oil Corporation (NOC) seeks to gradually boost production, with output expected to rise to around 260,000 bpd next week.
Before the blockade, Libya produced around 1.2 million bpd, or more than 1% of global production.
NOC, which said it would only resume at ports and oilfields that are free of military presence, has so far announced oil export resumption from the Hariga, Brega and Zueitina terminals.