Houston Ship Channel closure hits Exxon refineryOREANDA-NEWS. March 12, 2015. ExxonMobil is cutting rates at its 557,000 b/d refinery in Baytown, Texas, as emergency response to a damaged tanker continued to block traffic through the Houston Ship Channel.

Salvage work on the Carla Maersk was underway this afternoon after emergency crews failed to make progress overnight securing the vessel to move it following a collision on 9 March. ExxonMobil said the halt on inbound and outbound traffic since then had led its Baytown refinery to adjust output.

LyondellBasell said its 268,000 b/d refinery on the Ship Channel has not been impacted by the accident. Shell was evaluating contingency plans but not commenting on operations at its 340,000 b/d Deer Park joint venture refinery. Valero declined to comment on operations at its 90,000 b/d Houston refinery.

The jam has disrupted trade around the shipping channel as parties wait for the block to clear. There were 37 inbound vessels and 30 outbound vessels waiting this morning for a safety zone around the accident to lift and traffic to resume.

The port closure is so far having limited impact on the markets. Some chemicals traders reported several days' worth of delays in loading barges and vessels because of both the aftermath of the collision and fog that has lingered over the port this week, but others noted that thus far there is little, if any, impact to the spot markets. US benzene markets are currently well supplied, for example, so any delay in deliveries to the US Gulf coast are not pushing prices higher at the moment.

The Houston Ship Channel is home to the largest US LPG export terminals, but so far market impact from the lack of vessel traffic has been minimal.

Freight markets have also been largely unaffected so far as companies have been able to move empty vessel returning from other markets to the Caribbean to pick up oil and products cargoes.

The Port of Houston hopes to reopen the nearby Barbours Cut container terminal at 11am ET tomorrow, but said the plan was subject to change.

State and federal agencies working to secure and clear the Carla Maersk had hoped to seal off ruptured storage tanks containing the fuel additive MTBE with foam yesterday afternoon. Agencies deemed the plan insufficient and reworked the response this morning, the joint response center managing the accident said. Agencies must be careful not to ignite the highly flammable blendstock as they clear the ship.

A bulk carrier collided with the Carla Maersk during foggy conditions near Morgan's Point at 1:41pm ET on 9 March. The impact broke off a portion of the carrier's anchor, tore into the chemical tanker and released MTBE. The cargo was bound for Venezuela, the second-highest importer of US produced MTBE, behind Mexico.