Colonial Pipeline restarts after Nicholas, refineries continue to run

Quantum Commodity Intelligence - The Colonial Pipeline has restarted operations on some segments after tropical storm Nicholas hit Texas on Monday night and caused power outages, while oil refineries in the state continued to run as they assessed for any potential impact.

The gasoline-bearing Line 1 of the US' largest fuel line and distillates-carrying Line 2 between Houston, Texas, and Greensboro, North Carolina, was shut down after Nicholas brought 75 mph (120 kph) winds and heavy rainfall on Monday night.

"Colonial Pipeline has begun receiving product from shippers impacted by power outages in the Houston-area. As a result, we have resumed operations on Main Line 01 -- based on volume availability," a spokesperson for the company told Quantum, describing the situation as "fluid".

Line 2, however, was confirmed to remain offline, "but we will resume operations once product is made available," the spokesperson said.

Lines 3 and 4 continue to operate as normal.

The Colonial Pipeline, which delivers around 45% of all road and aviation transport fuel demand to the US East Coast, is expected to return to full capacity over the weekend, alleviating fuel shortages across parts of the country.

The pipeline transports 2.5 million barrels each day, taking refined gasoline, diesel, and jet fuel from the Gulf Coast to New York Harbor and major East Coast airports.

Local power supplier CenterPoint Energy said tropical storm Nicholas caused 400,000 of its customers in Texas to lose power following heavy winds and rainfall.

Shell said it is conducting a post-storm assessment at the 340,000-barrels-per-day Deer Park Manufacturing Complex refinery southeast of Houston, which it owns with Mexico's Pemex.

"At this early stage there does not appear to be serious damage from wind, rain or storm surge. Operations at the facility remain normal," Shell said.

Phillips 66 said its 265,000 bpd Sweeny Refinery was operational as the company conducts post-storm assessments.

"Several midstream assets in Southeast Texas have been affected by power outages," Philipps 66 said.

Some 43.6% or 793,522 bpd of oil production and 51.6% or 1.15 billion cubic feet per day of gas output in the Gulf of Mexico remains shut in after Hurricane Ida hit the region two weeks ago, based on data submitted by operators on Monday to the US Bureau of Safety and Environmental Enforcement (BSEE).