Several major oil companies announced they would shut down their Houston-area refineries during Hurricane Harvey.
Exxon Mobil stated it would close down its Baytown refinery, the company’s second-largest processor in the U.S., until the storm had passed. A spokesperson for Royal Dutch Shell PLC said the company would temporarily close down its Deer Park plant, while Brazilian state-run Petroleo Brasileiro SA would close its Pasadena plant during the storm.
The three plants combine for nearly 1 million barrels of oil processed per day.
These facilities, combined with several others in the Houston area, make up nearly 15 percent of the country’s domestic gasoline production.
With the storm still churning in the Gulf, as well as the time needed to assess damage and enact repairs, the impact to gasoline and fuel oil prices could be severe.
Harvey made landfall near Corpus Christi, Texas, late Friday night. Several refineries in the area were also shut down prior to the storm.
Valero announced the Corpus Christi facility did not sustain much damage, so the company is looking to get back online as soon as possible. However, the storm dealt significant harm to the city’s port, which the plant relies on for shipping its finished products. The company did not announce when the plant would go back online.
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The shutdown may lead to higher prices at the gas pump. Greg McBride, the chief financial analyst at Bankrate.com, told a business publication some areas affected by the storm may not see new fuel supplies for days or weeks.
“Those areas that do have gasoline will have long lines, high prices and frequently run out quickly,” McBride said.