• 6 minutes Saudis Threaten Retaliation If Sanctions are Imposed
  • 11 minutes Can the World Survive without Saudi Oil?
  • 15 minutes Saudis Pull Hyperloop Funding As Branson Temporarily Cuts Ties With The Kingdom
  • 4 hours WTI @ $75.75, headed for $64 - 67
  • 9 hours Saudi-Kuwaiti Talks on Shared Oil Stall Over Chevron
  • 13 hours OPEC's No. 2 Producer Wants to Know How Buyers Use Its Oil
  • 3 hours The Dirt on Clean Electric Cars
  • 2 hours Uber IPO Proposals Value Company at $120 Billion
  • 33 mins Closing the circle around Saudi Arabia: Where did Khashoggi disappear?
  • 9 hours UN Report Suggests USD $240 Per Gallon Gasoline Tax to Fight Global Warming
  • 3 hours U.N. About Climate Change: World Must Take 'Unprecedented' Steps To Avert Worst Effects
  • 6 hours COLORADO FOCUS: Stocks to Watch Prior to Midterms
  • 15 hours Iranian Sanctions - What Are The Facts?
  • 5 hours Nopec Sherman act legislation
  • 12 hours Who's Ready For The Next Contest?
  • 8 hours EU to Splash Billions on Battery Factories
Why Crypto Miners Are Paying Attention To The Permian

Why Crypto Miners Are Paying Attention To The Permian

The Permian is literally burning…

Lithium Is Yesterday’s News – Vanadium Is The Future

Lithium Is Yesterday’s News – Vanadium Is The Future

Scalable sustainable energy storage has…

Extreme Cold Weather Freezes US Fuel Supply

The US has been recently hit with cold weather that has broken records in many states, including in New York where the minus 16 Celsius managed to break a record that had stood since 1896. This arctic chill has forced natural gas and gasoline pipeline operators to reduce flow and refineries to scale back production, after some systems have started to fail under the extreme conditions. The instruments that control the flow have failed and some product has thickened or turned to jelly in some of the lines.

Due to the reduced production and delivery, oil prices have risen for the send straight day, and natural gas prices are at a 17 month high.

Related article: Oman and BP Finalize Gas Deal, Signaling Regional Change

Tyson Brown, a statistician from the EIA, explained that “the very cold temperatures widespread from Chicago east are driving up demand for natural gas,” but that “temperatures look to get a little bit more normal and ease off through the rest of the week.”

A vehicle struggling in the cold weather in New York
A vehicle struggling in the cold weather in New York.

The weather forced Kinder Morgan to announce a force majeure in Alabama and Georgia, as well as its ethanol terminal in Illinois, a fuel hub for the Midwest.

Eric Rosen, the vice president of sales, supply, and trading at Papco Inc., said that “at some point you have to have the gasoline blend with the ethanol, and that line from the ethanol tank to the rack is where you see a lot of those issues where it gets frozen.”

Other pipeline operators have declared similar force majeures in Pennsylvania, Illinois, and Utah, and production has fallen in the US Rockies, the Midcontinent, the Gulf Coast, and the Northeast.

Related article: A Quick Trading Opportunity for 2014

Bloomberg reports that:
PBF Energy’s 185,000 barrel a day refinery in New Jersey has had to shut down most production after the cold led to a loss of steam.
Valero Energy’s 195,000 barrel a day plant in Tennessee experienced frozen instruments and had units automatically trip offline.
Marathon Petroleum’s 114,000 barrel a day refinery in Detroit has managed to restart several units that had to be shut down after the cold weather caused instruments to fail.
Exxon Mobil’s 238,000 barrel a day refinery in Illinois has resumed full operation after some units suffered due to the extreme cold.
Korea National Oil Corp’s 115,000 barrel a day plant in Newfoundland was still not up and running after the weather caused a power cut across the entire island.

In total it is believed that the weather caused plant with a capacity of at least 800,000 barrels of day to shutdown.

By. Charles Kennedy of Oilprice.com


x

Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News