SPECIAL JETWIRE FOR WEDNESDAY, SEPT. 28, 2005
PLEASE POST ON ALL BULLETIN BOARDS
--- JET FUEL PRICES SURGE AFTER REFINING SHUT-DOWNS ---
As a result of Hurricanes Katrina and Rita, refining capacity along
the Gulf Coast has been significantly impacted. The current combined
impact of Hurricanes Rita and Katrina is the loss of approximately
3.6 million barrels per day of refining capacity, or about 20 percent
of the total U.S. refining capacity. The refineries in the Houston
area are slowly resuming operations.
Refineries in Port Arthur/Beaumont/Lake Charles, Tx., -- the area
most impacted by Rita -- are still assessing damage caused by the
hurricane. This area accounts for 1.7 million barrels per day of
refining capacity. Four refineries in Louisiana and Mississippi
representing .9 million barrels per day remain closed as a result of
Katrina.
American's Fuels Management group is working closely with suppliers,
pipelines and airport operators to manage our jet fuel supply through
this situation.
This impact on refining capacity has caused a significant increase in
the price that American pays for turning crude oil into jet fuel
(commonly referred to as the "crack spread"). The price tag for
refining crude oil into jet fuel has risen from an average of about
$11 per barrel in the first six months of 2005 to an all-time high of
$47.01 per barrel. Based on that spread and a crude oil price of
$65.07 per barrel, the cost of a U.S. Gulf barrel of jet fuel
exceeded $112 per barrel yesterday.
This increase further highlights the need to do everything possible
under the Lower Cost to Compete tenet of the Turnaround Plan.
PLEASE POST ON ALL BULLETIN BOARDS
--- JET FUEL PRICES SURGE AFTER REFINING SHUT-DOWNS ---
As a result of Hurricanes Katrina and Rita, refining capacity along
the Gulf Coast has been significantly impacted. The current combined
impact of Hurricanes Rita and Katrina is the loss of approximately
3.6 million barrels per day of refining capacity, or about 20 percent
of the total U.S. refining capacity. The refineries in the Houston
area are slowly resuming operations.
Refineries in Port Arthur/Beaumont/Lake Charles, Tx., -- the area
most impacted by Rita -- are still assessing damage caused by the
hurricane. This area accounts for 1.7 million barrels per day of
refining capacity. Four refineries in Louisiana and Mississippi
representing .9 million barrels per day remain closed as a result of
Katrina.
American's Fuels Management group is working closely with suppliers,
pipelines and airport operators to manage our jet fuel supply through
this situation.
This impact on refining capacity has caused a significant increase in
the price that American pays for turning crude oil into jet fuel
(commonly referred to as the "crack spread"). The price tag for
refining crude oil into jet fuel has risen from an average of about
$11 per barrel in the first six months of 2005 to an all-time high of
$47.01 per barrel. Based on that spread and a crude oil price of
$65.07 per barrel, the cost of a U.S. Gulf barrel of jet fuel
exceeded $112 per barrel yesterday.
This increase further highlights the need to do everything possible
under the Lower Cost to Compete tenet of the Turnaround Plan.