Pipeline Shutdown Has Had Little Impact on Supplies So Far

That is not even enough for a single day of average regional consumption, according to a report published on Saturday by Clearview Energy Partners, a research firm based in Washington. “Much depends on the duration of the outage,” the report said.

When Hurricane Harvey crippled several refineries on the Gulf Coast in 2017, suspending Colonial Pipeline flows of petroleum products to the Northeast for nearly two weeks, spot gasoline prices at New York Harbor rose more than 25 percent and took nearly a month to ease.

Regional refineries can add to their supplies from Kinder Morgan’s Plantation Pipeline, which operates between Louisiana and Northern Virginia, but its capacity is limited and it does not reach major metropolitan areas north of Washington, D.C.

The East Coast has ample harbors to import petroleum products from Europe, Canada and South America, but that can take time. Tankers sailing from the port of Rotterdam, the Netherlands, at speeds of up to 14 knots can take as long as two weeks to make the trip to New York Harbor.

Tom Kloza, global head of energy analysis at Oil Price Information Service, said the Biden administration could suspend the Jones Act, which requires that goods shipped between American ports be transported on American-built and -operated vessels. That would allow foreign-flagged tankers to move additional barrels of fuel from Gulf ports to Atlantic Coast harbors. The Jones Act is typically suspended during emergencies like hurricanes.

“One could make the case that the Biden administration might consider such a move sooner rather than later if Colonial software issues persist,” Mr. Kloza said.

Article source: https://www.nytimes.com/2021/05/09/business/energy-environment/colonial-pipeline-shutdown-gasoline.html