The Dow Jones Industrial Average (DJINDICES:^DJI) was up 25 points, to 16,301, at 12:30 p.m. following some mixed reports on the economy. Oil stocks on the Dow are up as the Houston shipping channel is set to reopen this afternoon after being closed for several days after a ship collision led to an oil spill. The S&P 500 (SNPINDEX:^GSPC) was just below breakeven at 1,857. West Texas Intermediate crude was down 0.4% to $93.36 while Brent crude was up 0.2% to $102.23.
On Saturday, an oil barge pulled by tug boat operator Kirby collided with a bulk carrier out of Greece. An estimated 4,000 barrels of crude oil spilled in the channel. The Coast Guard closed off the channel so it could contain and clean up the spill. Shipping traffic through a spill is possible, but the Coast Guard does not want the crude oil to be dragged out of the area.
The shutdown cuts off the Houston area from the ocean. Houston is particularly important for U.S. oil as a little more than 10% of U.S. refining capacity is in the area. Dow oil stock ExxonMobil (NYSE:XOM) said it had to slow production at its 560,000 barrels per day refinery in Baytown, Texas. Fellow Dow energy stock Chevron (NYSE:CVX) does not have a refinery in the area, but has been scouting locations with joint venture partner Phillips 66.
An estimated 140 ships are waiting to enter or exit the port, and the number is growing by about 40 vessels a day. Earlier today, Port of Houston officials said they expect to open the shipping channel later this afternoon, though they said the same thing yesterday. In any event, this looks to be a short-term challenge to the Houston area; it will not pose a long-term threat to the U.S. oil market, which is why you don't see oil prices rising.
Dan Dzombak can be found on Twitter @DanDzombak or on his Facebook page, DanDzombak. He has no position in any stocks mentioned. The Motley Fool recommends Chevron. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.