On Tuesday, just as Hurricane Harvey was peaking, we reported that according to ship-tracking data compiled by Bloomberg, as well as MarineTraffic real-time tracking, at least 25 tankers carrying almost 17 million barrels of imported crude oil were drifting near Texas and Louisiana ports, unable to offload because of closures from Tropical Storm Harvey.
Since then the situation has deteriorated by more than double, and as of Friday evening, Bloomberg reports that 54 tankers with capacity more than 33 million barrels either to deliver imported crude from Latin America, Europe, Caribbean, Africa and Middle East or receive U.S. supplies are drifting off U.S. Gulf Coast as several key ports remain closed while others are open with restrictions.
The historic "tanker traffic jam", last observed nearly two years ago as traders scrambled to store crude tankers in the same region in hopes of contango, can be seen on the Marine Traffic map below, only this time it has little to do with the shape of the oil strip, and everything to do with the logistical complications following Harvey :
According to Bloomberg, as of Sept. 1, 37 Aframaxes, 3 VLCCs, 8 Suezmaxes, 6 Panamax tankers are currently waiting off ports of Corpus Christi, Houston, Galveston, Freeport, Texas City, Beaumont, Nederland, Port Arthur, Port Neches, Sabine and Lake Charles, La. This is 8 more then the 29 tankers carrying 18.6mm bbl as of Aug. 31.
That said, the situation is slowly but surely getting resolved as more ports are starting to let traffic sneak through. On Friday, the port of Corpus Christi reopened to ship traffic, making way for seven refineries in the area to go back online. The Texas Gulf Coast supplies one-fourth of the nation’s oil and gas. Hurricane Harvey caused a severe hiccup in the gasoline supply chain over the last week, creating consumer panic and long lines at gas stations.
The first vessel to arrive since closure of the channel for Hurricane Harvey sails under the Harbor Bridge in Corpus Christi on Friday, Sept. 1
The port received its first tanker on Friday, Sept. 1, six days after closing in preparation for the storm, which came to shore as a Category 4 hurricane on Aug. 25. Some 20 vessels have been awaiting berth assignments and will now be able to enter Corpus Christi Channel.
Opening the port positioned Corpus Christi as the largest refining center fully operational on the Texas coast at this time. Nearly 100 percent of the electric power has been restored to the city’s refineries, while similar operations in Houston and Texas are tackling major flooding.
The nation’s economy depends on the port’s continued operation. More than 80,000 jobs depend on the Corpus Christi Ship Channel, where more than $100 million worth of goods pass through every day. Port of Corpus Christi stakeholders generate $350 million a day in national economic output
Here are some additional GOM port updates courtesy of Bloomberg:
Kinder Morgan, Colonial will commingle gasoline grades on products lines
Magellan is said to plan limited restart for Longhorn, BridgeTex
Houston port partial reopening is said to still affect tankers
U.S. Coast Guard says Port Corpus Christi to allow larger ships
Four Aframax tankers enter port of Corpus Christi after storm
Texas City refinery to resume exports as tankers arrive
Hurricane Harvey settled over southeast Texas on Saturday morning, "devastating torrential rain" and lashing the state"s Gulf Coast with damaging winds over hundreds of miles of coastline that braced for what forecasters predicted would be life-threatening storm surges.
According to CBS, no deaths were immediately confirmed in the hours after Harvey’s arrival, but officials noted emergency crews couldn’t get out in many places due to high winds. Melissa Munguia, deputy emergency management coordinator in Nueces County, which includes Corpus Christi, said early Saturday that it could be hours before crews could fully assess the damage in coastal communities.
Rockport Mayor Charles “C.J.” Wax told The Weather Channel on Saturday that Hurricane Harvey hit his coastal community “right on the nose” and left “widespread devastation.”
“This is going to be a very major disaster,” Texas Gov. Greg Abbott said Friday, hours before the storm hit between Port Aransas, just outside Corpus Christi, and Port O’Connor, to the north. Utilities reported widespread power outages on Saturday, some of which emergency officials said could last for days
Harvey made landfall just before midnight on Friday between Port Aransas and Port O"Connor as a monstrous Category 4 storm - the first of that level to strike the U.S. since Charley in 2004, and the strongest storm in more than 50 years to hit Texas.
By daybreak it had been downgraded to a Category 1 storm from a Category 4, according to the National Weather Service. But the storm was expected to settle in over South Texas for several days. As much as 30 inches of rain is forecast to fall by next Wednesday, with some areas getting as much as 40 inches.
Meanwhile, the storm surge could bring flooding of 6 to 12 feet to a coastal area that includes Matagorda Island and Port O"Connor. An estimated $40 billion worth of damage is expected to be left behind.
Craig "Cajun" Uggen, 57, nearly floods his truck as Hurricane Harvey comes ashore in Corpus Christi, Texas, on Friday, August 25, 2017. Minutes later, high winds blew off the camper carrying all of his belongings
Tyner Little, a spokesman for Nueces County, which includes Corpus Christi, said conditions were still severe in the area, but that winds appeared to be dying down. But Saturday brought a new threat: more rain, and possibly days of it. Mr. Little said the region was bracing for severe flooding as the storm sat over the coast with little signs of it dissipating anytime soon. According to forecasters, the storm could potentially cause devastating flooding in cities like Houston later in the week.
On Saturday morning, emergency workers and police spread out across coastal communities of Corpus Christi and Rockport to assess the damage, but conditions were making such operations difficult. No fatalities were immediately reported from the storm, the first substantial hurricane to hit Texas since Hurricane Ike struck the Gulf Coast in 2008. The last Category 4 storm to hit Texas was Hurricane Carla in 1961, according to the National Weather Service.
Meanwhile, approximately 213,000 local customers were without power, Electric Reliability Council of Texas, which manages the state’s power grid, said Saturday according to the WSJ. About 162,000 people were without power in the Corpus Christi area specifically, according to American Electric Power, a utility that serves the region. Early Saturday, Corpus Christi officials warned residents to reduce the use of toilets and faucets as the power outage had impacted the city’s wastewater-treatment plant. A boil advisory was in effect for water use in the city, which has about 325,000 residents.
According the National Hurricane Center, Harvey was moving slowly over the state, and would continue to produce torrential rains. In a Saturday morning bulletin, the center said that catastrophic flooding was expected over the next few days.”
According to the WSJ, the City of Rockport, along the coast near Corpus Christi, appeared to take a direct hit from the hurricane, local officials said late Friday night. Larry Sinclair, a commander with the Rockport Police Department said damage in at least in some parts of city was significant.
Mr. Sinclair said that officers and emergency workers were trying to assess the extent of the damage to buildings and were checking to see whether anyone was trapped inside. But he said wind conditions were making it difficult for emergency workers to evaluate the level of devastation the city and its residents had suffered.
“We were pretty much ground zero,” he said.
Earlier in the day, the mayor of Rockport told a local television station that residents of his coastal city who don’t evacuate should use a marker to write their names and Social Security numbers on their arms.
Defying forecasts that the storm would weaken as it headed inland, Harvey had picked up strength churning toward the Gulf Coast, and is expected to drench the state with as much as 40 inches of rain in some areas, according to the National Weather Service. The National Hurricane Center warned of “catastrophic flooding” from the storm. Even before the center of the storm made landfall Friday night, hurricane-force winds were being reported along the coast, according to the National Hurricane Center. Friday night, 104,000 people had lost power, according to a tweet from a state power-grid operator.
Late on Friday, Texas Gov. Abbott said FEMA had granted his request for a presidential disaster declaration in response to Harvey. President Donald Trump also tweeted that he had signed the declaration, making more federal aid available to the state. On Saturday morning, Trump congratulated the on-the-ground response to Hurricane Harvey for avoiding mistakes his predecessor made in response to Hurricane Katrina in 2005.
“We have fantastic people on the ground, got there long before #Harvey. So far, so good!" he tweeted. He was responding to a warning from Sen. Chuck Grassley (R-Iowa) the day before to “keep on top” of Harvey in order to avoid repeating the “mistake” former President George W. Bush made during Hurricane Katrina.
.@ChuckGrassley - got your message loud and clear. We have fantastic people on the ground, got there long before #Harvey. So far, so good!
White House officials said President Trump had been briefed on storm preparations, and that he would have access to any staff or resources he might need while spending the weekend at Camp David, the presidential retreat in Maryland. Trump intends to visit Texas early next week as part of his response to the hurricane, White House press secretary Sarah Huckabee Sanders said.
Homeland Security adviser Tom Bossert, also a former homeland security adviser to Bush, spoke frankly of mistakes made during Katrina on Friday during a White House press briefing. “I think it"s not just what"s on my mind but on the minds of all of the emergency managers in our community, especially those in Texas and Louisiana,” Bossert said of Katrina. “That experience is still in their minds, in their muscle memory. Congress has gotten better, passed laws to allow us flexibility to employ not just deploy in advance of an event.”
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Before the storm made landfall on Friday, thousands of people fled inland, leaving behind deserted coastal communities with boarded-up homes and businesses, and barren grocery stores. But others stayed behind, prompting fears from local officials as the hurricane grew more powerful.
Threatening the local energy infrastructure, major ports were closed, and oil operations along the Texas coast were suspended. There are more than 800 oil platforms in the path of the storm and more than 100 refineries and terminals on the shore that could be disrupted, according to the consultancy firm Riskpulse.
According to Bloomberg calculations, the hurricane has forced shutdown of approximately 1 million b/d of crude and condensate refining capacity in Texas, which equates to ~10% of PADD3 refining capacity. It had also suspended ~22%, or 377k b/d, of Gulf of Mexico oil production. Among the shuttered refiners are the following:
Citgo 163k b/d Corpus refinery is said to shut ahead of hurricane
Flint Hills Corpus Christi East, West plants shut; capacity 293k b/d; company declared force majeure on plant
Magellan Corpus Christi, Texas, condensate splitter; capacity 50k b/d
Valero shuts Corpus Christi East, West plants and Three Rivers refinery; combined capacity 478k b/d
Shell Deer Park said to shut largest crude unit; refinery capacity 316.6k b/d
The U.S. Geological Survey forecast that the storm’s power could significantly impact 65% of the state’s coastline.
Separately, Gov. Abbott said that in addition to strong winds, officials are concerned about flooding caused by the storm hovering over the coastal bend of Texas.
“We are going to be dealing with immense, really record-setting flooding in multiple regions across the state of Texas,” Gov. Abbott said according to the WSJ. “There will be a tremendous amount of rain dropped on miles upon miles of Texas.” People who hadn’t moved away from the coast face the possibility of going a long time without access to basic necessities such as water, power and food, the governor said.
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From small coastal communities to major ports such as Houston and Corpus Christi, which handled hundreds of billions of dollars worth of cargo last year, emergency officials scrambled Friday to make final preparations before Harvey hit.
Houston officials said the city was preparing for significant effects from the hurricane, mostly in the form of heavy rains that could swamp the city. Police and fire officials started preparing evacuation boats, high-water rescue vehicles and supplies in anticipation. Residents were being urged to have a week’s worth of food and water on hand. Houston officials said Friday that no mass evacuations will be called for the Houston region, despite expectations the area will see a massive amount of rain over the next several days. Officials say flooding is likely, especially as rainfall builds up in the local bayous.
“We want people to be alert, prepared, on guard, stocked up, patient, sheltered, calm and ready,” Houston Mayor Sylvester Turner said as he urged people to stay off the roads.
In an interview at Houston TranStar, a government emergency operations center where officials are coordinating storm efforts, Mayor Turner said storm surge out of Galveston could also cause problems, as it blocks water from the draining into the Gulf.
In Corpus Christi, a city of roughly 325,000, city officials said that people living in low-lying areas were being strongly encouraged to leave, but officials had not issued a mandatory evacuation order. Mayor Joe McComb defended the city’s decision not to order people out, saying he had consulted at length with local officials. He added that many residents had heeded warnings to leave, though he didn’t have any estimates on how many had left.
Corpus Christi’s shoreline was empty Friday as rain and wind whipped against now boarded-up hotels that line the street, the occasional police car slowly patrolling. Nearby, residents rushing to a HEB grocery store for last-minute supplies were turned away. The store, like many others here, had shut its doors early.
Luis Perez watches waves crash in Galveston, Texas as Harvey intensifies: Photo AP
