Hurricane effects on the energy sector.
Hurricanes are natural disasters that have the potential to do massive damage. Hurricane Harvey was a category 5 storm that impacted both Texas and Louisiana. Harvey left over 300,000 people without power, displaced over 30,000 people and forced the rescue of over 13,000 people. The potent winds caused billions of dollars in damage to include poles and wires that caused power outages and affected the energy grid. People are the most affected by power outages because without power it is difficult to cook and perform daily activities. The recovery effort for power is very dangerous because with so many downed lines and so much flood water any area is a potential hazard. Oil and Gas production was also affected because people could not go into work and all this production took an unscheduled pause. This limited the supply and increased the demand of Oil and Gas. Transportation and storage was also affected due to so many road closures limiting the accessibility of storage locations (Choice, 2017).
The most significant impact for the energy sector was the oil refineries. While crude oil prices went down, petrol oil went up and this is because the closing of the refineries will limited the refining of the crude oil. In 2008 Hurricane Ike missed Houston by a narrow margin and since then they have spoken of creating dykes for protection of Galveston Bay, but nothing has been done since. Perhaps this is the best option in order to mitigate damage levels. The current major vulnerabilities are the exposure of shale oil wells, refineries and the Houston energy complex. These are the areas that need to be looked at for protection from another hurricane which is just a matter of time before it comes along (Mills, 2017).
Choice, E. (2017, September 11). Electric Choice. Retrieved from 2017 Hurricane Season & Energy: Impacts, Dangers and More: https://www.electricchoice.com/blog/hurricane-energy-impacts/
Mills, R. (2017, August 17). The National. Retrieved from https://www.thenational.ae/business/energy/how-will-hurricane-harvey-affect-us-energy-sector-1.623246