Oil and Gas: Supply Issues After Katrina and Rita (CRS Report for Congress)
| Release Date |
Revised Oct. 3, 2005 |
| Report Number |
RS22233 |
| Report Type |
Report |
| Authors |
Robert L. Bamberger and Lawrence Kumins, Resources, Science, and Industry Division |
| Source Agency |
Congressional Research Service |
| Older Revisions |
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Summary:
Hurricane Rita was expected to make landfall early Saturday, September 24. Asprecautionary measures, refineries along, or near, the Texas coast were shutting down,or at best, reducing runs. The Department of Energy (DOE) has estimated that 4.8million barrels daily (mbd) of U.S. refining capacity are potentially in the storm's path.In the meantime, roughly 900,000 mbd of refining capacity remains shut owing toHurricane Katrina, which made landfall on August 29, 2005. The total, 5.7 millionbarrels, represents roughly one-third of total U.S. refining capacity. Oil and natural gasproduction have been sharply affected. By mid-September, roughly 40% of oilproduction and 50% of natural gas production in the Gulf of Mexico remained shut-in.However, operating installations have been evacuated and shut down. As of September22, nearly 92% of normal oil production was shut-in, and roughly 66% of normal gasproduction was shut down. Pipelines that transport gasoline and other products to theEast and Midwest are also shut down, which may lead to spot shortages independent ofRita's damage to the refining infrastructure. These shortages will likely be significantlyworse if refinery runs along the Texas coast cannot be restarted quickly. Dependingupon the path of Hurricane Rita and the damage inflicted, gasoline shortages arepredicted with prices rising well over $3.00/gallon and perhaps reaching $4.00/gallon.This report will be updated. Most of the information cited in this report is from the tradepress, the Minerals Management Service, and the Energy Information Administration.
