US crude exports could take big hit from Laura

Hurricane Laura is set to make landfall near Beaumont, Texas, later today, possibly causing major damage to the third top port hub for US crude exports.

The Port of Beaumont accounted for about 13pc of the 3.2mn b/d of US crude exports over the first six months of 2020, according to monthly Census trade data. Terminals there are a destination for Bakken crude and other domestic grades. In addition, the adjacent Port Arthur accounts for another 2pc of US oil exports.

The US Coast Guard today set Beaumont and Port Arthur to condition Zulu, essentially shutting the ports ahead of the storm's landfall.

Meanwhile, the Louisiana Offshore Oil Port (LOOP) off the coast from Grand Isle, Louisiana, said on 23 August that it suspended operations at its marine terminal ahead of Laura and tropical storm Marco which weakened significantly before making landfall on 24 August. LOOP accounted for about 7pc of US crude exports from January-June 2020. LOOP could come back online fairly quickly depending on storm damage.

The Houston Ship Channel is expected to be closed to all traffic sometime today but the shutdown could be short-lived as Laura's direct hit is forecast to be far to the east of the busy port. Houston accounted for about 21pc of US crude exports in the first half of 2020.

The top port for US crude exports — Corpus Christi, Texas — is out of the path of Laura. But that port was partially shut for three days starting on 21 August after a deadly explosion and fire from a ruptured propane pipeline near the port's refinery area last week. The Port of Corpus Christi is open but still has some restrictions from the Chemical basin to the Viola basin. Corpus Christi handled about 45pc of US crude exports from January to June of this year.

Overall US crude exports have stabilized near 2.75mn b/d since June, after a sharp Covid-19-related drop in March-May.

US crude exports averaged about 2.87mn b/d in the four weeks ended 21 August, according to Energy Information Administration weekly estimates.

By Eunice Bridges