Most of Oklahoma has been locked in ice for several days. There was slow thawing today, although more bad weather may be on the way.
Here at Peace Arena, we've been lucky and are, at worst, suffering from cabin fever, but the weather is creating a lot of concern in the business world, including reports that one of the country's most important oil distribution hubs — in Cushing, OK, y'all — is, or was until late today, paralyzed.
First the local business worry about profit and loss in the Journal Record:
EXPERTS CONSIDER CHILLING IMPACT ON ECONOMY
Estimating the economic quagmire from the ice storm damage goes beyond the 600,000-plus homes and businesses reported without power. That results in thousands upon thousands of lost work hours, uncountable lost transactions, lost sales tax, lost productivity, and if the situation stretches on, lost perishables. In a commerce system that survives on daily, sometimes hourly cash flow, each moment that builds debt without gaining a dime of revenue can spell trouble. – Kirby Lee DavisUTILITIES MAY SEEK RATE HIKES TO RECOVER STORM LOSSES
OG&E is losing about $1.5 million per day due to the ice storm, and by the time restoration is completed, the company may be looking at total losses of $10 million or more. – Jerry Shottenkirk
The first item, I'll cut some slack on, since it is a business paper, so they're writing to their audience. I'll trust they mention elsewhere that 13 people have died. The second is total spin. After the ice storms 5 or 6 years ago (before I came to the state), I have no doubt that OG&E set up a contingency fund (if they didn't have one before, which would have been smart). But if they use this to hike rates, it's shameless.
In the Chilling Impact story, it's very interesting that the paper notes a concern that's also been creeping into business stories and opinion pieced in the Oklahoman: the negative impact on the state's economy by the new anti-immigration law.
The storm has destroyed or damaged up to 90% of trees in some areas and clean up needs will be extensive. So now, business leaders wonder: Will there be enough labor to meet the need?
I have a hard time making myself not hope for this scenario to play out badly for Oklahoma, where so many politicians and their constituents created this problem for the state by writing and passing 1804.
Well, I don't want any additional suffering, even for business interests I don't usually sympathize with, but I guess I do want the state to be affected just enough to wake up to what they've done and get busy undoing it.
The ice in Oklahoma also got the attention of suits around the world, because a distribution point in Cushing (“the nation's most important oil hub.” Who knew?), lost power. Of course, this means prices go up.
The outages at the Cushing hub, where inventory shifts weigh heavily on oil prices, helped push crude oil prices up $2.16 to $90.02 a barrel on Tuesday.
The storm, which has contributed to the deaths of at least 13 people, entered Oklahoma early Sunday, bringing freezing rain and ice that snapped tree branches and power lines before hitting Kansas, Missouri and Illinois.
In Oklahoma, the hardest-hit state, OGE Energy Corp (OGE.N: Quote, Profile, Research) said the storm was the worst in the company's history and estimated it would take between seven and 10 days to restore power to more than 285,000 customers.
Companies operating facilities at the key hub are in the midst of expansions to ramp up storage capacity there by nearly 9 million barrels to 44 million barrels this year.
All this reminds me of how the political pundits somehow, no matter what happens that would seem to be a disaster for the Administration and their Congressional lapdogs, explain how it's good news for Republicans. In the end, bad news is always good for business, it seems.