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Saudi Investment Fund Eyes Tesla Rival

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Oil Prices Fall On Significant Crude Build

Oil Prices Fall On Significant Crude Build

Oil prices fell on Wednesday…

US Oil Refinery Runs Out Of Crude As Hurricane Season Rages On

Refinery

The 185,000-bpd refinery of Monroe Energy in Trainer, Pennsylvania ran out of oil due to shipment delays caused by hurricane activity in the Caribbean, shipping data and a source close to the company, as quoted by Reuters, revealed.

The shipment that caused the idling of several units at the facility was the VLCC C. Innovator, carrying West African crude, which encountered rough waters that hurricanes Maria and Jose caused. The vessel loaded in Nigeria on September 4, and 19 days later was anchored at the mouth of the Delaware River, off the Pennsylvania coast.

Kpler data confirmed the location of the vessel, adding that it carries 1.6 million barrels of crude. The Paris-based data provider also said that the VLCC’s presence at the Big Stone anchorage, where cargo is transferred from larger to smaller vessels, is causing a headache. The place has been quite busy in the last few days, and a VLCC’s presence among the vessels is not helping other vessels reach the coast.

Reuters notes in its report on the event that VLCCs cannot unload its cargo directly at a refinery on the East Coast and it can’t unload at most U.S. ports due to their size. Instead, they are anchored in deep waters and the oil is first transferred to smaller vessels that then take it to shore.

Hurricane Maria is currently moving up the U.S. Atlantic Coast, and forecasts indicate that it will be downgraded to a tropical storm before it reaches the North Carolina coast. From there, the hurricane is expected to head east, reaching the UK coast during the weekend, along with another hurricane, Lee. At its height, Maria devastated Puerto Rico.

Related: Was Goldman Sachs Wrong About Oil Demand?

The worst hurricane this season to hit the U.S. coast was Harvey, which shut down about a fifth of national refining capacity, causing major buildups in crude oil inventories. The shutdowns came a few weeks before many refineries were scheduled to enter maintenance, and some were forced to do so as they had delayed regular maintenance work for weeks and even months, Bloomberg reported last week.

There were, as of September 19, at least 13 refineries that have delayed maintenance, and their combined capacity is 3.27 million bps, so we may expect further inventory builds, despite yesterday’s API estimate, which said crude oil inventories had declined by 761,000 barrels.

By Irina Slav for Oilprice.com

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