The Saturday collision in heavy fog between a cargo ship and a Kirby Inland Marine barge released as much as 168,000 gallons of heavy fuel oil into Galveston Bay, at the mouth of the channel. The accident shutdown all marine traffic on the 52-mile corridor, which connects eight refineries to their supply of crude oil. Combined, the facilities account for about 12 percent of the U.S. refining capacity, and include two of the nation’s biggest – Exxon’s refinery in Baytown and Marathon Petroleum’s in Texas City
So far, Exxon and Valero have said they haven’t seen any impact. Marathon hasn’t commented. But refineries need a steady diet of crude to maintain production, and their output could be cut if the channel remains closed for more than a few days. The Coast Guard set up an emergency safety zone around the spill area that lasts through March 29, and indication that the shutdown could continue for much of the week.
The ship channel accident comes as oil markets are already uneasy because of Russia’s annexation of the Crimean peninsula. In addition, gasoline prices have inched up as refineries begin their normal switch over from winter to summer fuel formulas.
In 2008, when Hurricane Ike roared into Houston, the refineries were closed as a precaution. Pump prices in the southeastern U.S. surged as much as $5 a gallon.
Gas prices have risen by an average of almost 5 cents a gallon in the past two weeks, to $3.56 a gallon, its highest price since late September, according to a survey of 2,500 filling stations, Bloomberg reported.
Meanwhile, the economic impact of the spill was already being felt in other areas. Shares of Kirby Corp., the parent company of the barge operator, fell as much as 4 percent this morning, to 101.69. In addition to transport of crude oil and refined products, the ship channel is a key conduit for chemicals and feedstock.
The Coast Guard says 43 ships are waiting to leave the port and 35 were waiting to enter as of Sunday morning. It's not clear how many of those were carrying crude oil. Among the vessels stuck in the channel is a Carnival cruise ship that was set to depart from Galveston. In addition to the economic impact, the environmental toll could be heavy because of the time of year. As the Houston Chronicle reported:
The spill also comes at the "worst time" for tens of thousands of shore and seabirds, an estimated 50,000 of which roost at the Bolivar Flats refuge only about two miles from where the spill occurred, according to Richard Gibbons, conservation director for the Houston Audubon Society.
"We're at the peak of the birding season. In a couple weeks, there's a birding festival," said Anna Armitage, a professor at Texas A&M University's Galveston branch who is an expert on marshes and marine habitats. "This is one of the worst times for birds to be potentially exposed."
Experts said it is too soon to say how extensive the environmental and economic damage will be. But fishermen said they were already throwing back oil-covered catches.
High winds and choppy water spread the oil as far as 12 miles into the bay, making containment efforts more difficult.
