Texas refineries reopen as Harvey set to hit Houston again

Flooding from Hurricane Harvey that has led to at least eight deaths and disrupted business in the oil-rich state of Texas is set to worsen with another 127cm of rain expected to fall upon the state on Tuesday as the effects are also felt in Louisiana, Mississippi and Alabama.

President Donald Trump was set to visit areas hit by Harvey, which has been downgraded to a tropical storm, on Tuesday to receive a briefing on the relief operations in Corpus Christi, Texas before touring emergency operations centres in Austin.

Floods caused by the storm have led to around a fifth of oil refineries on the Gulf of Mexico coast being shut down, which contributed to US gasoline prices rising to their highest since 2015 at the start of the week, though oil prices fell on Monday.

But production at Gulf refineries has already recommenced and a large oversupply and, while imports and exports were blocked in East Texas ports, elevated levels of storage before the storm should quell any fears of crude shortages.

Between two and three million barrels per day of refining capacity is offline or in the process of shutting down, Barclays said, with more than 500,000 bpd of oil production offline.

Harvey's impact is likely to “linger for several more weeks”, the bank said, while others analysts suggested crude oil inventories will build up.

TRUMP SCRAPPING OF FLOOD PROTECTION

Days before the Hurricane hit, Trump had signed an executive order that saw many of the flood protections introduced by former US President Barack Obama scrapped to get infrastructure projects approved quicker.

The regulations, while not yet in effect, were put together to make it more difficult for roads, bridges and other such infrastructures to be erected in areas susceptible to flooding.

In a move praised by businesses but strongly opposed by environmentalist lobbies, the President said earlier in August, "We're going to get infrastructure built quickly, inexpensively, relatively speaking, and the permitting process will go very, very quickly."

Trump also noted that his threats to shut down the US government would not hamper the recovery effort.

Flooding has left at least eight people dead and almost 2,000 people have been rescues as regions in the Gulf of Mexico received a year's rainfall in one week.

"The breadth and intensity of this rainfall are beyond anything experienced before," tweeted the US National Weather Service. "Catastrophic flooding is now underway and expected to continue for days."

Flooding is set to worsen as federal engineers said they would be releasing water from overflowing reservoirs to keep it from escaping dams and running over into homes they are built to protect.

30,000 residents in Houston, the fourth-largest city in the US, were expected to be left temporarily homeless.