We had feared the worst of Hurricane Rita, but fortunately it didn't cause as much damage to the oil refineries as it might have. But oil production has been temporarily reduced because of power outages and refineries that were shut down in anticipation of the hurricane. "Good Morning America" financial contributor Mellody Hobson talked about what Rita's aftermath could mean for gas and oil prices.
Refineries located in and around Houston fared much better than expected. Exxon Mobil Corp. said workers would return today to begin restarting its 557,000-barrel-per-day Baytown refinery, the largest in the country.
Power outages in Texas and Louisiana have left more than a million customers, including refineries, without electricity in the aftermath of Rita.
Since Katrina, more than 33 million barrels of oil and 156 billion cubic feet of natural gas have been lost.
On Sunday, the average retail cost of gasoline nationwide was $2.78 a gallon, up 2 cents from the day before and 90 cents higher than a year earlier, according to the Oil Price Information Service of Wall, N.J.
The Houston region accounts for about 25 percent of the nation's oil refining capacity. Fortunately, because of Rita's path, we didn't see the level of destruction that we all had feared. Only two of the region's many refineries were damaged. Those refineries will take a couple of weeks to repair and get running again. That's bad news. But certainly, it's not as bad as it could have been.
We also have to remember that in preparation for the storm, the oil companies shut down more than a dozen refineries. All offshore oil productions in the area were also shut down. So we're losing about 1.5 million barrels of oil a day because of the shutdown. But nearly all those refineries and oil platforms will be running normally very soon.
