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- In the wake of Hurricane Ida, US President Joe Biden has directed the Energy Department to release petroleum reserves
- The hurricane ripped through Louisiana, the centre of the country’s oil production and refining industry, and Mississippi on the weekend
- More than 93 per cent of oil production in the Gulf of Mexico remains shut in and several refineries are yet to come back online
- In the past week, West Texas Intermediate Futures, a benchmark for US crude oil, has risen 1.75 per cent
As the clean up from Hurricane Ida continues in the US states of Louisiana and Mississippi, the toll of the extreme weather event is becoming clearer.
Forty-one people have died and authorities warn this number could rise further.
The hurricane’s passage through Louisianna almost ground US oil production to halt. According to estimates from the Bureau of Safety and Environmental Protection, 93.55 per cent of the oil production in the Gulf of Mexico remains shut-in. Several refineries in Louisiana are also yet to come back online.
In the immediate aftermath of Ida, US President Biden has directed the energy department to release petroleum reserves to reduce pressure on gasoline prices.
“We’re not waiting to assess the full impact the storm is going to have on oil production and refineries, removing already quickly to increase the availability of gas and easing the pressure on gas prices around the country,” Mr Biden said.
“I’ve directed the secretary of Energy, Jennifer Granholm, to use all of the tools at her disposal, including using the Strategic Petroleum Reserve to keep gas flowing to the pumps.
“In order to get critical supplies to the region to beat the pandemic, I directed the Department of Transportation to renew an energy declaration to provide flexibility on how many hours a truck driver can drive.”
Over the past week, West Texas Intermediate Futures, a benchmark index for US crude oil, has risen 1.75 per cent to around the US$70 (A$94.37) per barrel mark.
