Ahead of the bell this morning on the first trading day of a new week, all port of Houston facilities remain closed following Hurricane Harvey slamming the Southeastern coast of Texas last Friday. Of all ports in the U.S., Houston’s ranks #1 in foreign tonnage, especially in oil and gasoline exports. Much of metropolitan Houston remains under water, with more storms expected.
The Texas coast in general accounts for 30% of the entire oil refining capacity of the U.S., and almost 15% is from the region most directly affected by the storm. Houston metro GDP accounts for roughly half a trillion dollars per year, and at this stage the dollar amount this storm’s disruptions have caused are anyone’s guess.
In today’s pre-market, gasoline futures for September are up 4%, and +3.4% for October futures. This is unsurprising, as lowered supplies in gasoline would naturally lead to higher prices. However, oil prices overall are down this morning, as the temporarily shuttered refineries do not address the ongoing global oil supply glut. That said, plenty of Gulf of Mexico offshore rigs have temporarily closed down in the wake of Harvey as well, but it doesn’t look at this point like that’s put much of a dent in the overall global supply. Yet, anyway.
Of course, rescue efforts continue throughout the entire region. FEMA still considers Harvey — now downgraded to a tropical storm — dangerous, especially for the Galveston area, where storm warnings remain in place at this hour. Also, rivers in the area are not expected to crest — reach their highest peaks of water levels — until later this week, which increases the flooding dangers. FEMA assures the public that it is unifying ll agencies in support of keeping people safe in this still-ongoing situation.
More disruptions to the refinery process are expected, as well: ExxonMobil ((XOM - Free Report) processes more than 500K barrels of oil per day at its plant in the Houston area. And in nearby Port Arthur, TX, Saudi Aramco runs a plant that processes even more barrels per day. And insurance companies like Travelers ((TRV - Free Report) have lots of exposure in the region, so we will keep an eye on these stock prices today, as well.
Uber Chooses New CEO
Though plenty of people were expecting a well-known CEO like Meg Whitman or Jeff Immelt to take the helm of the still-private ride-sharing giant Uber, former Expedia ((EXPE - Free Report) CEO Dara Khosrowshahi was who received the offer, and reportedly accepted just hours later. The Iranian-American executive grew the online travel site several times over during the last decade, tripling EXPE’s share price in the process.
Obviously, the board at Uber hopes for similar success. However, with a work culture still in need of repair from allegations of sexual misconduct, plus an ongoing lawsuit with Alphabet’s ((GOOGL - Free Report) Waymo self-driving car unit, there is plenty of tough sledding ahead for Uber and its new boss.