Secretary Perry taps emergency oil stockpile for Hurricane Harvey relief
In an announcement made this week, Energy Secretary Rick Perry authorized the nation’s Strategic Petroleum Reserve (SPR) to release thousands of barrels of crude oil to compensate for Hurricane Harvey-caused refinery outages.
“The U.S. Secretary of Energy has authorized the Strategic Petroleum Reserve (SPR) to negotiate and execute an emergency exchange agreement with the Phillips 66 Lake Charles Refinery,” Jessica Szymanski, Department of Energy spokeswoman, said in a statement. “This decision will authorize 200,000 barrels of sweet crude oil and 300,000 barrels of sour crude oil to be drawn down from SPR’s West Hackberry site and delivered via pipeline to the Phillips 66 refinery.”
The Phillips 66 refinery is located in Lake Charles, Louisiana, and thus far remains unaffected by Hurricane Harvey. Others have not fared nearly so well, though. The Colonial Pipeline, which funnels gasoline and other fuel between Houston and the East Coast, is shutting down, and to date, a full one-fifth of the nation’s refining capacity has been knocked offline. In Texas, 13 oil refineries have been shut down or are shutting down currently, while even more are operating at reduced rates.
Depending on how long flooding continues and how badly they swamp the facilities and their pumps, they could also remain down for a long time after the worst has passed. Further complicating matters are port closures, which have left those facilities still operating with even less access to crude oil.
In all, it’s creating an environment of potential ripple effects throughout the country. The move by Perry is meant to shield the United States from rising gasoline prices as a result. AAA has already assessed the average price of a gallon of gasoline has risen by 10 cents due to the disruption in the U.S. Gulf Coast.
“The department will continue to provide assistance as deemed necessary, and will continue to review incoming requests for SPR crude oil,” Szymanski said.
