Oil and Gas: Supply Issues After Katrina and Rita

Publication Date: October 2005

Publisher: Library of Congress. Congressional Research Service

Author(s):

Research Area: Energy

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Abstract:

In anticipation of Hurricane Rita, which made landfall early September 24, U.S. refining operations totaling 4.8 million barrels daily (mbd) along or near the Texas coast were shut down. At the end of September, 2.2 mbd remained shut. An additional 900,000 mbd of refining capacity remains shut owing to Hurricane Katrina, which made landfall on August 29, 2005. Some refineries could restart if electric power were restored; other refineries will require repairs to damaged facilities. The hurricanes have also affected oil and natural gas production. By early October, roughly 94% of oil production and 75% of natural gas production in the Gulf of Mexico remained shut-in. Operating platforms in the path of the storms, which number 2,900, were evacuated. Some offshore production is expected to resume during the week of October 3. Some of the pipelines that transport crude oil, gasoline, and other products to the East and Midwest have resumed operation, but the several days' loss of oil and natural gas production, along with oil refining and transportation of both oil and gas, have made for tight supply and sustained high prices. These conditions will likely grow significantly worse if refineries along the Texas coast cannot be restarted quickly, and concern grows about the price of winter fuels. This report will be updated. Most of the information cited in this report is from the trade press, the Minerals Management Service, and the Energy Information Administration.