Hurricane Harvey's oil refinery disruptions could last months, analysts say
Calgary-based Husky Energy and Cenovus Energy have interests in U.S. located well out of Harvey's path
Analysts say U.S. Gulf Coast refinery outages that have sparked higher gasoline prices in the United States and Canada will likely continue to affect North American markets for months.
Citing similarities to previous outages caused by hurricanes Katrina in 2005 and Ike in 2008, they say it will take two to three months for refinery production and distribution to return to normal after the extensive flooding wrought by Harvey, now considered a tropical storm.
Canada sends about 400,000 barrels per day of crude oil to Gulf Coast refineries.
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According to a report from AltaCorp Capital in Calgary, mid-continent refining profit margins have jumped by about 20 per cent this week, a development that's expected to boost the bottom lines of Calgary-based Husky Energy and Cenovus Energy.
Both companies have interests in U.S. refineries located well out of Harvey's path.
Research director Jackie Forrest of ARC Financial, meanwhile, says she expects Harvey's effect on the gasoline market could match that of Katrina 12 years ago and result in higher fuel prices in the U.S. and Canada that last until November.
IHS Markit says about 30 per cent of U.S. Gulf of Mexico refinery output is expected to be idled as the storm makes its way eastward toward the Port Arthur/Lake Charles refining hub on the Texas-Louisiana border.