Latest News

Bush urges fuel conservation with Rita's impact worse than thought

WASHINGTON—President Bush on Monday urged Americans to cut back on car trips amid warnings that the energy disruption from Hurricane Rita could be worse than initially thought.

Although Rita spared massive refineries and chemical complexes in the Houston area, the first reports about damage to offshore production of crude oil and natural gas were grim.

"The early indication is that at least as many rigs are going to be impacted from Rita as Katrina. Rita went through an area of the gulf where there simply were more mobile offshore rigs," said David Kent, owner and editor of Rigzone.com, a Web site devoted to offshore oil production. "Rita cooled off once she got to shore, but she was churning out there for a while pretty viciously."

Offshore production across the entire U.S. Gulf of Mexico remained closed Monday, meaning a fifth of the nation's oil production has been shutdown since Thursday. Even before oil workers evacuated offshore rigs in advance of Rita last week, Hurricane Katrina had knocked out 56 percent of Gulf oil production.

On-shore refineries also took a hit. The Energy Department said Monday that Katrina and Rita together had cut the nation's refining capacity by 25 percent. Even when energy companies restart their Texas and Louisiana facilities, at least 10 percent of U.S. refining capacity will remain idle for weeks or months.

Bush issued his call for conservation after receiving a briefing on the energy outlook. He urged Americans to avoid unnecessary car trips and encouraged federal workers to use public transportation or join car pools. He directed federal agencies to curtail nonessential travel and to conserve electricity during peak hours when possible.

Bush also signaled that he's ready to tap the federal government's emergency oil reserves for the second time this month to boost energy supplies.

The average price of unleaded fuel rose to $2.80 a gallon on Monday, up from $2.75 on Sunday, according to AAA. A year ago, a gallon of unleaded gas cost $1.89.

"We can all pitch in by being better conservers of energy," Bush said during a visit to the Energy Department. "People just need to realize that the storms have caused disruption."

Bush's call for conservation, reminiscent of President Jimmy Carter's plea for energy restraint in the late 1970s, was a striking shift in emphasis for a president who's tended to focus more on boosting production.

Bush sought to reassure Americans that he's well aware of their pain at the pump. The president plans to travel to Beaumont and Port Arthur, Texas, on Wednesday to get a better assessment of the damage to Gulf Coast refineries and other energy facilities.

Many of the steps that Bush outlined Monday were already in place for Katrina. The Energy Department has drawn down at least 13.2 million barrels of crude oil from the government's Strategic Petroleum Reserve to keep oil flowing to refiners. Bush said he's willing to draw down more for Rita, if necessary.

Oil company executives were still tallying up the damage from the back-to-back storms. The two hurricanes slammed into a region that supplies about 20 percent of the nation's oil production and about 45 percent of its refining capacity.

On Monday, the nation's largest pipeline operator, Colonial Pipeline Co., confirmed it was shipping gasoline from its Houston facilities to the southeastern United States at only 55 percent of capacity.

Chevron reported that its Typhoon deepwater drilling platform, which is in 2,000 feet of water, broke from its mooring and suffered severe damage. Diamond Offshore Drilling, Global Santa Fe and Rowan Companies, all offshore drillers, also reported that rigs have disappeared or have been damaged.

In other developments Monday, ConocoPhillips confirmed that its Lake Charles, La., refinery, which has a capacity of 239,000 barrels per day, sustained wind damage. It didn't immediately say whether the damage would render the facility inoperable for weeks, as is the case for Rita-damaged refineries in Port Arthur, Texas.

The lack of new refineries has long been a drag in the nation's energy supply network. To encourage the construction of new refineries, Bush and Republicans in Congress are pushing legislation to provide incentives such as special government-backed insurance.

The House Committee on Resources will start work Wednesday on legislation designed to make it easier for state governors and legislatures to authorize offshore oil and natural gas exploration and production.

Some consumer groups have accused oil companies of deliberately restricting refining capacity to keep gasoline prices high.

"They know when they make less gasoline, they make more money," said Jamie Court, president of the Foundation for Taxpayer and Consumer Rights, a Los Angeles-based group that frequently battles oil companies in court.

———

To get energy saving tips go to www.energysaver.gov.

———

(c) 2005, Knight Ridder/Tribune Information Services.

GRAPHICS (from KRT Graphics, 202-383-6064): 20050926 STORMS oil, 20050926 US gas prices

Need to map

Related stories from McClatchy DC

  Comments