Many Americans can breathe a sigh of relief as workers slowly return to the Gulf to survery storm damage today. As of Wednesday morning, I have yet to hear of major damage to any facility that processes oil or natural gas. That has led to a large oil sell-off the last few days, with crude oil shedding almost $10/bbl and gasoline losing around 20-cents/gal.
Valero has reported no major structural damage to its 250,000bpd St. Charles, LA refinery. The refinery does have electrical power but will check to make sure the power is reliable.
Shell Oil Co. has reported “So far, so good” from its VP, Frank Glaviano after taking an aerial survery of its offshore operations.
Valero’s 295,000bpd Port Arthur, TX refinery as well as its 245,000bpd Texas City, TX refinery continue to run at reduced rates at this hour.
As of Tuesday though, the USMMS (United States Minerals Managemen Service) was reporting 100% of Gulf oil production remains closed while 95.4% of its natural gas production remains closed.
This is good news for traders, who are shedding contracts as quickly as possible, leading to large losses in oil and gasoline prices.
In Grand Rapids, we should see prices down into the $3.60’s before any hike, with nationwide averages approaching $3.50!
Stay tuned as more storm updates are available.