Hurricane Michael’s Impact On Gasoline Demand
Gasoline demand increased in the Florida Panhandle, southern Georgia, and South Carolina ahead of Hurricane Michael’s arrival to the areas, but repercussions to demand appeared to focus on rack cities in the direct path of the storm, according to our Supply Side daily rack volume data. The increased rack activity provided some uplift to PADD 1C demand Oct. 7 to 10. Daily rack activity on Oct. 9 jumped to the highest daily level since the approach of Hurricane Florence to the Carolinas in September.
Michael’s long-term ramifications to supply are not yet obvious. Ports along the upper Gulf Coast and southern Atlantic Coast closed either completely or to inbound traffic starting Oct. 9. Restrictions on ports in Mississippi, Alabama, Florida, North Carolina, and Virginia remained as of Oct. 12, with Savannah and Charleston reopening Oct. 11. Gasoline supply in these five states relies upon waterborne barge movements from the U.S. Gulf Coast (PADD 3) and cargo imports. To add to the constrained inflows, Colonial Pipeline reported power outages at delivery facilities in southern Georgia on Oct. 11. Colonial assessed damages and impacts to Line 17, which runs from Atlanta to Bainbridge, GA, off Colonial’s 2.6mn bpd mainline system.
Hurricane Michael made landfall as a Category 4 hurricane on Oct. 10 near Mexico Beach, FL, with maximum sustained winds of 155 mph—the strongest tropical cyclone to hit the Florida Panhandle in recorded history and the fourth strongest Atlantic tropical cyclone to hit the U.S. mainland. When Michael moved into Georgia on the evening of Oct. 10, the storm became the most intense disturbance to hit the state since 1898. The cyclone made its way through Florida, Georgia, South Carolina, North Carolina and Virginia. As of Oct. 12, Michael was a post-tropical cyclone off the coast of Delaware, heading northeast towards open water.
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