Account Information

  • My Account

    Manage all your subscriptions, update your address, email preferences and change your password.

  • Help Center

    Get answers to common service questions, ask the analyst or contact our customer service department.

  • My Stock Talk Profile

    Update your stock talk name and/or picture.


These contrarian stocks thrive in good markets and bad

These contrarian stocks thrive in good markets and badIn my new profit guide, I reveal a group of super-safe stocks that don’t behave like regular stocks during market downturns. In fact, these rock-solid beauties historically SKYROCKET and THRIVE during the worst of times. During the last three market busts, stocks in this contrarian sector soared 42%… 135%… and even 200%. Do yourself a favor. Check out my free profit guide today.


Texas Refinery Update

By Robert Rapier on September 7, 2017

In last week’s column, I explained Why Harvey’s Impact At The Pump Could Be Significant. Since then, gasoline prices have surged across the country, and there have been numerous gasoline shortages across Texas. 

Today, I want to provide the latest update on the situation.

Before Hurricane Harvey, U.S. refineries were processing 17.7 million barrels per day (BPD) of crude oil. Refining capacity was running at 96.6% utilization. This extremely high utilization rate reflects growing U.S. demand for gasoline and increasing exports of finished products like gasoline, diesel, and jet fuel. 

Hurricane Harvey’s path swept right through the heart of the U.S. Gulf Coast refining complex. In just a few days, eighteen refineries were impacted, representing an estimated 30% of U.S. refining capacity. 

As I noted last week, the refineries around Corpus Christi probably wouldn’t be down for long. This week most of them are reportedly running back at normal rates. That’s primarily because this region didn’t experience the flooding associated with the storm around Houston. 

But the country’s two largest refineries — the Motiva Refinery in Port Arthur, Texas and the ExxonMobil (NYSE: XOM) refinery in Baytown, Texas both suffered damage from flooding. At press time, the Motiva Refinery was beginning initial startup procedures and hoped to have the plant at 40% capacity by the end of the weekend. ExxonMobil continues to make repairs, but thus far hasn’t provided a timeline for the Baytown refinery’s restart. 

The Department of Energy is issuing daily updates on the situation. They list capacity offline, and then capacity that is either restarting or running at reduced rates. They also report on oil production that was impacted by the storm.

Six refineries in the Gulf Coast region remain shut down. These refineries have a combined refining capacity of 1.7 million BPD, equal to 17.2% of total Gulf Coast refining capacity and 9.0% of total U.S. refining capacity.

Five refineries are in the process of restarting after being shut down. This process may take several days or even weeks, depending on whether any new damage is discovered. These refineries have a combined capacity of 1.6 million BPD, equal to 16.0% of total Gulf Coast refining capacity and 8.4% of total U.S. refining capacity. 

At least seven refineries in the Gulf Coast region were operating at reduced rates. These refineries have a combined total capacity of 1.7 million BPD, equal to 17.2% of total Gulf Coast refining capacity and 9.0% of total U.S. refining capacity.

Of critical importance to the South and the South Atlantic states, the Colonial Pipeline restarted Line 2 (distillate) between Houston and Lake Charles on September 4. Line 1 restarted on September 5 and began shipping gasoline from existing stocks in the Houston area. Line 1 provides gasoline for stations from Houston, Texas to Linden, New Jersey. 

Crude oil prices initially fell as a result of the refinery outages. This is because crude oil production was less impacted by the storm than was refinery capacity. Crude oil production in the Gulf of Mexico fell by ~400,000 BPD during the storm but has since recovered all but about 100,000 BPD. 

Oil production in the Eagle Ford, which was about 1.3 million BPD just before the storm, was impacted as well. Most major producers shut down or greatly reduced production, but it is quickly returning to normal. At press time, an estimated 200,000 BPD of production remains idled in the Eagle Ford. 

As the Texas refineries have come back online, crude oil prices have jumped. Since closing below $46/bbl on August 30th, the price of West Texas Intermediate has jumped by 7%. This increase will erode refining margins, which grew as a result of falling oil prices and rising gasoline prices. 

In turn, the refining sector itself surged as a result of the storm. Leading the pack were refiners like Andeavor (NYSE: ANDV) and HollyFrontier Corp (NYSE: HFC), neither of which have any Gulf Coast refineries.  

In my next article, I will address the issue of price gouging, which has been a hot topic over the past two weeks. 

Follow Robert Rapier on Twitter, LinkedIn, or Facebook.

You might also enjoy…


Here’s What’s Really Going to Crush the Market

Most folks understand the basic concept of inflation… things cost more money. But tragically, most don’t understand the real implications of what it means for their financial future. 

Or just how dangerous it’s becoming right now. Today.

And there are two reasons for that…

First, the U.S. government’s calculations barely take into account two of the things you and I are paying more and more for every day: energy and food.

Second, since inflation really hasn’t been an issue for the past 30 years here in the U.S., most analysts won’t dare to say it’s on the rise because they’ll suffer professionally. 

But I’ve made a name for myself by always saying what needs to be said. Which is why I’ve prepared a new special report that’ll give you simple instructions on how to protect yourself from the coming storm.

And better still…

It gives you the full story on the six types of investments that are destined to soar 275%… 375%… even up to 575% over the next few years as the winds of inflation flatten the U.S. economy.

You can get your free copy here.

Stock Talk — Post a comment Comment Guidelines

Our Stock Talk section is reserved for productive dialogue pertaining to the content and portfolio recommendations of this service. We reserve the right to remove any comments we feel do not benefit other readers. If you have a general investment comment not related to this article, please post to our Stock Talk page. If you have a personal question about your subscription or need technical help, please contact our customer service team. And if you have any success stories to share with our analysts, they’re always happy to hear them. Note that we may use your kind words in our promotional materials. Thank you.

You must be logged in to post to Stock Talk OR create an account.

Create a new Investing Daily account

  • - OR -

* Investing Daily will use any information you provide in a manner consistent with our Privacy Policy. Your email address is used for account verification and will remain private.