Motor gasoline rack activity in the U.S. Southeast reacted to an outage on Colonial Pipeline’s 1.3 bpd million Line 1 between October 31 and November 6, with volumes declining in cities exclusively or predominately supplied by the pipeline, according to Genscape Supply Side data. Meanwhile, rack activity in cities with waterborne access, such as in Savannah, GA, and Charleston, SC, jumped after the outage.
On October 31, an explosion occurred in Shelby County, AL, along Line 1, where repair efforts have continued since a September 9 gasoline spill that previously shut the pipeline. The explosion forced Colonial to shut Lines 1 and 2 on October 31. Line 2, a 1.1 million bpd distillate line, was restored to service the night of October 31. Line 1 restarted November 6, according to a statement from Colonial Pipeline. In September, Line 1 was shut for 12 days, significantly affecting gasoline racks in the southeastern U.S. During that outage, Colonial allowed gasoline to move on Line 2.
The declines in Southeast rack city level volumes during the most recent outage were not as significant as those seen during the Line 1 outage in September. The mitigating factor, along with a shorter outage duration, appeared to be truck resupply to inland rack terminals from waterborne ports (see graph 2).
Savannah rack activity increased greatly after the outage, jumping as high as 423 percent above week-ago levels on November 6. Savannah gasoline rack activity averaged just more than 340,000 gallons per day in the week prior to the October 31 Line 1 explosion. Since that event, Savannah gasoline rack activity has averaged 1.3 million gpd. Charleston, SC, gasoline rack activity also increased following the Line 1 outage on October 31, jumping as high as 126 percent above week-ago levels on November 5.
Other cities most affected by the most recent Line 1 outage were those in Georgia, Tennessee, North Carolina, and South Carolina that are mainly supplied by Line 1. Kinder Morgan’s 700,000 bpd Plantation pipeline runs parallel to Colonial, and provides gasoline deliveries to several cities that also have Colonial connectivity. The impact of this outage does not appear to be as significant in cities that have access to both lines.
In Georgia, the rack cities most affected by the Line 1 October 31 outage were Albany, Atlanta, Bainbridge, and Macon. Albany rack activity was as much as 32 percent below week-ago levels on November 6. In Atlanta, gasoline rack volumes dipped as much as 45 percent below levels during the previous week on November 5. Bainbridge gasoline rack volumes dropped to 19 percent below week-ago levels on November 4. In Macon, rack activity fell 24 percent week-on-week on November 3.
Tennessee gasoline rack activity declined most significantly in Nashville, one of the state’s largest gasoline rack cities. Nashville is supplied by a spur off Line 1 and does not have Plantation connectivity. Nashville gasoline rack volumes dipped as much as 30 percent week-on-week on November 5. Chattanooga rack activity also fell nearly 30 percent below the previous week on November 5 and 6.
South Carolina gasoline rack demand fell significantly in North Augusta, where terminals are supplied by a spur line off Line 1. North Augusta gasoline rack activity dropped as much as 73 percent below the previous week on November 6.
In North Carolina, rack activity also declined week-on-week in Fayetteville and Charlotte. Fayetteville gasoline rack volumes fell as much as 53 percent below the previous week on November 5. In Charlotte, gasoline rack activity dipped week-on-week by 27 percent on November 6.
Genscape's Supply Side Analyst and Supply Side Monitor provide analysts and traders with daily or hourly volumes and prices for regular gasoline, midgrade gasoline, premium gasoline, jet fuel, kerosene, and diesel. Receive the industry’s only insight into PADD and rack city related volumes and average prices for wholesale transactions of refined products. To learn more, or request a free trail of Genscape's Supply Side Analyst and Supply Side Monitor, please click here.
Genscape's Gasoline and Distillate Supply Chains Webinar will be on November 16 at 2:00pm (EST). Topics will include Colonial Pipeline's Line 1 outages, what's ahead for diesel diemand, the current state of affairs for distillate, rack activity, distillate storage, translatlantic movements, and more! To learn more, or to register for the webinar, please click here.