But another factor driving demand is that more stringent fuel-economy standards have put downsized and turbocharged engines in more and more new cars. And most, if not all, of those engines, whether in a Mini Cooper or a Nissan Juke, require premium for the best power and mileage.

Largest US refinery Motiva may be shut up to two weeks: Report

Published 16 Hours Ago

Motiva Enterprises' Port Arthur, Texas refinery, the nation's largest, may be shut as long as two weeks for assessment of the plant and repair of any damage, sources familiar with plant operations said on Thursday.

The 603,000 barrel per day (bpd) Port Arthur Refinery was shut on Wednesday due to flooding from Tropical Storm Harvey.

In a statement to CNBC, Motiva said it "cannot provide a timeline for restart at this time." The oil company says it will begin assessing the refinery "as soon as the local area flooding has receded," although Motive is uncertain about how long it will take for floodwaters to diminish.

Gulf Coast struggles to get gasoline flowing as refineries remain shut, starving pipelines of fuel

Published 13 Hours Ago

Texas refineries slammed by Harvey aimed to start back up on Thursday, but pipeline shutdowns and continued refinery outages in southeastern Texas and Louisiana hampered the effort to get fuel flowing to markets.

Refiners that took the brunt of Harvey's first landfall near Corpus Christi on Friday got the restart process underway on Wednesday. However, about 20 to 25 percent of U.S. refining capacity remains offline, creating problems in the pipeline systems that move gasoline and other fuel around the east half of the U.S.

Pipeline operators have been forced to throttle back or suspend flows of gasoline and other petroleum products.

The Colonial Pipeline Company also shut down part of critical lines that transport gasoline, diesel and aviation fuel from Houston through the southeast and up the East Coast to New Jersey. The closure prevented fuel flows along a stretch from Houston to Hebert, Texas.

The partial closure is due to a lack of supply from idled refineries, as well as storm damage to Colonial's facilities near Lake Charles, Louisiana, according to Colonial. Fuel deliveries will be intermittent and depend on its ability to receive supplies from refineries and terminals.

"Think of Colonial Pipeline like a garden hose. It needs to have so much in there as line fill to pump and to pump normally," said Tom Kloza, global head of energy analysis at Oil Price Information Service. "Clearly, they haven't been getting the injections from Texas, so that's going to be problematic heading through next week."

Lack of product is also preventing the Explorer pipeline from transporting fuel from Houston to Tulsa, Oklahoma, and onward to Chicago, according to Lipow.

While about 25 percent of total U.S. refining capacity is offline, something on the order of 40 percent of capacity that serves Americans east of the Rockies had been affected.

The worst-case scenario could be a price spike on the order of 40 to 60 cents that pushes gasoline prices to $2.60 to $2.75 per gallon.