Oil and natural gas prices jumped Tuesday as a massive winter storm kneecapped energy production in the US.
West Texas Intermediate crude oil futures traded near their highest levels in about 13 months after the storm forced oil wells and refineries to shut down in Texas, the nation’s biggest oil-producing state.
They were recently up about 0.5 percent at $59.79 a barrel after topping $60 a barrel on Monday as the storm left millions without power in the Lone Star State.
Natural gas prices also spiked amid the blackouts and bitter-cold temperatures that have gripped swaths of the US.
Gas for physical delivery from two Midcontinent hubs traded for as much as $500 per million British thermal units on Monday as demand for the fuel exploded during the storm, Bloomberg News reported. Natural gas from that region reportedly trades for less than $3 per million BTU in normal times.
The upward pressure continued Tuesday morning with natural gas futures climbing about 7.4 percent to roughly $3.13 as of 9 a.m.
The unusual cold snap hammered the energy industry in Texas — which churns out about 4.6 million barrels of oil a day — and surrounding states that play an important role in fuel distribution.
Oil giants ExxonMobil and Citgo had to shut down parts of their Texas oil refineries on Monday amid the freezing conditions and the power disruptions they caused.
Gas pipeline operator Kinder Morgan grappled with capacity constraints in several states including Arkansas, Texas and New Mexico. And Enbridge, an oil pipeline operator, had to halt a pipeline that runs from Illinois to the massive oil storage hub in Cushing, Oklahoma because of power outages on Monday.
With Post wires