Texas Oil Producers and Refiners Face Chaos Amid US Deep Freeze
A massive winter storm that swept across the United States over the weekend has severely impacted oil and gas producers, as well as the industrial plants that refine these raw commodities into essential products like gasoline and plastics.
Refinery flares illuminated the Houston Ship Channel late Sunday and into Monday morning, as a cold front struck the Texas coast, driving temperatures below freezing. Major plants operated by INEOS, Pemex, Shell, and LyondellBasell all reported flaring gases—a standard safety measure employed during operational disruptions caused by severe weather.
In anticipation of the freeze, several facilities, including ExxonMobil’s Baytown mega refinery and Goodyear’s Bayport chemicals facility, curtailed operations on Saturday. The waterway that connects Houston’s refineries to crude imports and global export markets was closed on Saturday as the cold front approached, only partially reopening on Monday morning.
The weather-related refinery issues extended beyond East Houston’s industrial corridor. One of INEOS’s plants on the Texas coast was struck by lightning as the winter storm approached, causing the facility to trip offline, according to a regulatory filing. Further north in Illinois, where refineries are designed to operate in colder conditions, Phillips 66’s Wood River plant reported a leak in its piping system due to the winter storm, as noted in a community alert from the company.
Freezing temperatures also posed challenges for companies extracting oil and gas in West Texas. Chevron reported that hatches were freezing open, while Anadarko faced difficulties in making repairs to a leaking water tank due to the severe weather. Numerous filings with the state’s environmental regulator linked operational issues to the severe winter weather disaster declaration issued by Texas Governor Greg Abbott as the storm approached.
The freeze has resulted in approximately 22% of natural gas production being taken offline in the southern central U.S. corridor, indicating that crude production is likely down by 1 million barrels a day, according to Scott Shelton, an energy specialist at TP ICAP Group Plc. Prior to the freeze, the U.S. was producing just under 14 million barrels of oil daily.
On Monday, oil futures traded lower by as much as 0.9%, with gasoline futures leading the petroleum complex down by as much as 1.8% due to decreased industrial and travel demand. Conversely, fuels used for heating and electricity generation, such as diesel and natural gas, saw a surge, with heating oil futures rising by as much as 4.9%.
Copyright 2026 Bloomberg.
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A massive winter storm that swept across the United States over the weekend has severely impacted oil and gas producers, as well as the industrial plants that refine these raw commodities into essential products like gasoline and plastics.
Refinery flares illuminated the Houston Ship Channel late Sunday and into Monday morning, as a cold front struck the Texas coast, driving temperatures below freezing. Major plants operated by INEOS, Pemex, Shell, and LyondellBasell all reported flaring gases—a standard safety measure employed during operational disruptions caused by severe weather.
In anticipation of the freeze, several facilities, including ExxonMobil’s Baytown mega refinery and Goodyear’s Bayport chemicals facility, curtailed operations on Saturday. The waterway that connects Houston’s refineries to crude imports and global export markets was closed on Saturday as the cold front approached, only partially reopening on Monday morning.
The weather-related refinery issues extended beyond East Houston’s industrial corridor. One of INEOS’s plants on the Texas coast was struck by lightning as the winter storm approached, causing the facility to trip offline, according to a regulatory filing. Further north in Illinois, where refineries are designed to operate in colder conditions, Phillips 66’s Wood River plant reported a leak in its piping system due to the winter storm, as noted in a community alert from the company.
Freezing temperatures also posed challenges for companies extracting oil and gas in West Texas. Chevron reported that hatches were freezing open, while Anadarko faced difficulties in making repairs to a leaking water tank due to the severe weather. Numerous filings with the state’s environmental regulator linked operational issues to the severe winter weather disaster declaration issued by Texas Governor Greg Abbott as the storm approached.
The freeze has resulted in approximately 22% of natural gas production being taken offline in the southern central U.S. corridor, indicating that crude production is likely down by 1 million barrels a day, according to Scott Shelton, an energy specialist at TP ICAP Group Plc. Prior to the freeze, the U.S. was producing just under 14 million barrels of oil daily.
On Monday, oil futures traded lower by as much as 0.9%, with gasoline futures leading the petroleum complex down by as much as 1.8% due to decreased industrial and travel demand. Conversely, fuels used for heating and electricity generation, such as diesel and natural gas, saw a surge, with heating oil futures rising by as much as 4.9%.
Copyright 2026 Bloomberg.
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