Exxon Mobil Corporation (NYSE:XOM) announced on Saturday that it decided to slash the rates at its Baytown refinery in Texas after the Houston ship channel was shut down due to Hurricane Harvey.
The hurricane alert has obviously presented a huge threat to the company and has already started to disrupt business. The firm decided to set lower rates to try and boost activity in the 560,000 barrel-per-day refinery. The announcement also came just one day after Exxon shut down its Galveston 209 and Hoover platforms in the Gulf of Mexico due to the same the Hurricane Harvey threat.
“We continue to work with the Port of Houston to facilitate safe delivery of crude shipments when channel conditions allow,” pointed out Exxon in a statement.
The Baytown refinery happens to be the second largest refinery complex in the nation. The size of the refinery also makes it equally important because it contributes greatly to the oil and gas supply in the nation. Baytown also happens to be a major petrochemical hub and it has been going through massive expansion.
Suann Guthrie, a spokeswoman for Exxon stated that safety was the company’s first priority and as such, various precautionary measures have been taken. This is to ensure that the shutdown and any other activity has minimal impact on the company’s employees as well as a minimum impact on the community.
Exxon Mobil is not the only firm whose refineries have been affected by the Hurricane Harvey threat. Flint Hills Resources, Citgo Petroleum, and Valero Energy have all shut down their refineries temporarily due to the hurricane threat. Most of the refineries in the Houston refinery corridor seems to be headed in the same direction. More than 25 percent of the U.S fuel supplies come from the Texas Gulf Coast. This means that the hurricane could significantly disrupt the oil supply chain over the next few days. Things are expected to get back to normal once the threat of the hurricane passes.
Exxon stock closed the latest trading session on Friday at $76.72 after a 0.51 percent gain compared to the value of the stock during the previous close.