The frigid temperatures that descended into Texas in February and paralyzed the state’s energy grid caused the largest reduction in Gulf Coast refinery operations in nearly five years, the U.S. Energy Information Administration (EIA) said in a research note Monday.
Gulf Coast refinery runs decreased by 2.4 million b/d, or 28%, to 6.3 million b/d during the week ended Feb. 19, the agency said, marking the steepest weekly drop since the damage imposed by Hurricane Harvey in September 2017.
Most of the disruptions and shutdowns were among refiners in the Beaumont/Port Arthur, Houston and Corpus Christi regions of Texas, EIA said.
“The Gulf Coast accounts for more than half of total U.S. refinery capacity, and Texas alone accounts for about 32%,” researchers said. “By the peak of the weather’s impact on February 17, several refineries had announced either substantial or complete shutdowns as a result of external power outages, constrained natural gas supplies, logistical disruptions or damage to process units.”
Overall, gross inputs to U.S. refineries declined 2.7 million b/d to 12.6 million b/d for the week, dragged lower by cuts in Texas, researchers said.
“The refinery closures will likely continue to affect petroleum markets in the coming weeks, reducing refinery demand for crude oil and production of refined products such as motor gasoline and distillate fuel oil,” EIA said.
During the week of the Arctic cold snap, overall petroleum demand dropped 10% week/week and fell 6% from a year earlier, EIA previously noted in its latest Weekly Petroleum Status Report.
In the same week, U.S. crude production averaged 9.7 million b/d, down 1.1 million b/d from the prior week and down 3.3 million b/d from a year earlier. EIA cited power outages and frozen well operations in Texas as the principal culprits.
U.S. refineries operated at 68.6% of their capacity in the covered week, down from 83.1% the prior week, the agency reported.
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