Petroleum data for the week ending November 9 released today by the U.S. Energy Information Administration (EIA) provide the second set of data to assess the impacts of Hurricane Sandy on U.S. petroleum markets. The storm significantly disrupted electricity, natural gas, and petroleum product supply infrastructure in the Northeast and affected millions of consumers. However, the data from the first week following Hurricane Sandy showed falling gasoline inventories in the Northeast Petroleum Administration for Defense Districts (PADDs 1A and 1B) including the New England states, New York, New Jersey, Pennsylvania, and Delaware, the region hit hardest by the storm (Figure 1), as reduced gasoline deliveries into the region and a drop in refinery production were likely partially offset by reduced demand. These data indicate that aggregate supplies of physical products across the broader Northeast region have been less of a problem than disruptions due to damage to terminals, ports, and pipelines serving the New York metropolitan area. These disruptions have especially stressed supply chains between the wholesale and retail segments.
Refinery inputs have fallen sharply in the two weeks after the storm, lowering the production of gasoline in the Northeast. About 70 percent of the refining capacity in the Northeast is located along the lower Delaware River near Philadelphia. For precautionary reasons, these refineries either briefly shut down or reduced runs, but were largely back online relatively quickly after the storm. However, the 308,000 barrels per day (bbl/d) of refining capacity in the New York Harbor area were still inoperable through November 13. The major plant in the area, Phillips 66's 238,000-bbl/d refinery in Linden, New Jersey, suffered both power loss and flooding. Hess's plant in Port Reading, New Jersey, which has no crude distillation capacity, but produces gasoline and other petroleum products using units that process secondary feedstocks to produce gasoline, also lost power. The shutdowns at the New York Harbor facilities combined with the temporary reduction in runs in the Philadelphia area to lower gross inputs in PADD 1 by 290,000 bbl/d for the week ending November 2 compared to the previous week. PADD 1 gross refinery inputs for that week were 757,000 bbl/d, the lowest for any week since April 2011. The drop in inputs came on the heels of some of the highest levels of PADD 1 refinery inputs in almost a year following the early-October restart of Monroe Energy's 185,000-bbl/d refinery in Trainer, Pennsylvania. On November 5, Phillips 66 said it planned to have the Linden refinery return to production within three weeks. As of November 14, press reports indicated Hess's Port Reading facility was in the process of restarting. With some of the Philadelphia area refineries returning to more normal operations, PADD 1 gross refinery inputs increased by 101,000 bbl/d during the week ending November 9 to 858,000 bb/d.