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Texas Refineries Could Take Two Weeks To Fully Restore Operations After Storm

Most refineries on the U.S. Gulf Coast have begun procedures to restart operations that were disrupted by the massive winter storm late last week, but a full return to normal output of motor fuels could take up to two weeks for some facilities.   

The freezing temperatures affected refinery equipment and caused issues at the steam and co-generation units at some refineries, sources with knowledge of the situation told Reuters on Wednesday.

Pemex’s Deer Park refinery and Motiva Enterprises’ Port Arthur, the biggest refinery in the United States, could see their restart stretched out to the first or second week of January, sources familiar with the refineries’ operations and schedules told Reuters.

Winter Storm Elliott led to hard-freeze warnings issued for all the states along the U.S. Gulf Coast, where most of the U.S. refining capacity is located.   

As of Friday, December 23, as much as 1.5 million bpd of the Gulf Coast’s refining capacity was shut down due to the freezing temperatures, per Reuters estimates.

Refineries run by Motiva Enterprises, Marathon Petroleum, and TotalEnergies outside Houston were shut late last week. Operations at other refineries in Texas, run by ExxonMobil, Valero Energy, and LyondellBasell, were also disrupted by the severe winter storm.  

In total, the extreme winter weather affected some of the output at refineries along the Gulf Coast that process a combined 3.58 million barrels per day (bpd) and deliver around 20% of U.S. motor fuels.

Last week, the national average gasoline price dropped for a seventh consecutive week, but it’s not certain this week will bring another decline in gasoline prices, due to the rally in oil prices and the refinery outages due to the storm, according to fuel savings app GasBuddy.

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“We’re still waiting for the national average to fall below $3 per gallon, something that is suddenly a bit less likely given the extreme cold weather, interrupting refining operations in the south, curbing gasoline production and potentially driving prices up slightly,” Patrick De Haan, head of petroleum analysis at GasBuddy, said on Tuesday.  

By Tsvetana Paraskova for Oilprice.com

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