Wild U.S. Weather, But Energy Largely Spared

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Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)--Tornado warnings combined with blizzard warnings over a large swathe of the continental United States may test the grid, though power outages were minor as of Tuesday.

A low-pressure system over Canada combined with a cold front over parts of the Dakotas to bring cold Canadian air across much of the central Plains to the Gulf Coast. A tornado warning was in place for Texarkana briefly on Tuesday morning. Blizzard warnings were in place, meanwhile, for parts of Iowa.

The National Weather Service added that the conditions for fires along the Gulf Coast and into Kansas were "extreme."

North American weather over the past few months has been exceptionally volatile, with repeated cold blasts and wintery weather reported as far south as the U.S. Gulf Coast. While Los Angeles coped with its worst wildfire season on record, those in New Orleans were digging out from 10 inches of rare snow.

IIR Energy has continued to monitor the weather situation and its impact on the nation's energy sector. So far, there have been few lingering issues, though production in North Dakota was curtailed by the cold weather, with around 100,000 barrels per day (BBL/d) in oil production sidelined by Mother Nature so far this year.

After a late-February storm system curtailed production, however, state regulators in North Dakota said they were expecting a recovery in March. North Dakota, home to the Bakken shale formation, produces around 1.2 million BBL/d on average.

The severe cold posed a threat to midstream and upstream operations as well, as pipeline operators issued warnings about any potential impact to their networks. During the latest round of inclement weather, however, IIR Energy has seen no impact to the nation's refineries.

Elsewhere, PowerOutage.us, a website monitoring the national grid, showed around 400,000 consumers were out of power as of Tuesday morning, with most of those consumers in Texas. The Electric Reliability Council of Texas, the state's grid operator, reported that there was enough power to meet consumer demand, however.

The weather looks to clear out by the weekend, and the thermometer shouldn't drop too much despite the blizzard conditions. A blizzard warning was in effect for Topeka, Kansas, on Tuesday, but the forecast is for highs in the 50s and sunny skies by the weekend.

Natural gas prices posted a sharp rebound on Tuesday. The contract for Henry Hub, the U.S. benchmark for the price of natural gas, was largely suppressed last year on weak demand, posting an average price of $2.20 per million British thermal units (MMBtu). The price was up more than 6% from the prior day to trade in the $4.40 per MMBtu range on Tuesday.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).