Houston, We Have A Problem

1 Sep 2017; Hurricane Harvey, the most powerful storm to hit the U.S. in more than a decade, made landfall on Friday night on the central Texas coast and severely disrupted oil production and refining operations in the region, first around Corpus Christi and Houston and later, as the storm moved, to Beaumont and Port Arthur.  In anticipation of hurricane Harvey, 102 offshore platforms and 5 rigs were evacuated and more than 300,000 barrels per day (b/d) of U.S. Gulf of Mexico oil production was taken offline according to the Bureau of Safety and Environmental Enforcement (BSEE). A significant portion of Texas’ onshore shale production, in particular in the Eagle Ford region was shut in as well.  On the downstream side of the business, an estimated 3 million barrels of refining capacity was shut down.  In addition, the whole logistical network that surrounds the energy complex, including ports, terminals and pipelines have been affected and the ripple effects are felt around the world.  The impact on certain segments in the crude and product tanker market has been significant.

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