Harvey hits gas pump prices in Midwest

Thursday, 31 Aug, 2017

McTeague says now officials are a long way of from knowing the long-lasting and permanent effects of Hurricane Harvey.

Big jumps at the pump have already been seen in Kansas communities. Texas and Louisiana refineries supply regions north and east of the Gulf Coast; refineries in the greater Northwest and Mountain West serve Washington and Idaho. S&P Global analysts said about 2.2 million barrels per day of refining capacity were down or being brought down by Sunday.

Gasoline futures spiked in trading.

At $2.40 per gallon, on Wednesday, August 30, 2017, AAA confirmed the national gas price average was six cents more expensive on the week, and one of the largest one-week increases recorded this summer. "Increases could, however, go higher than 25 cents per gallon if refinery damage is extensive". It will take time to assess damage and any longer-term impact on refining capabilities.

"If you have no refinery, you got no gasoline, no jet fuel, no diesel fuel". While those production facilities are down, the US market is losing about 3 million barrels of gasoline a day.

Kim Fundingsland/MDN The price of gasoline increased at some pumps in Minot as of midday Tuesday.

How long we'll see higher prices, he says, really just depends on how long refineries are down.

Even before the Harvey made landfall late Friday, dozens of oil and gas platforms had been evacuated. In addition to the key ports in Houston and Corpus Christi, ports in Lake Charles, Beaumont and Port Arthur are also down.

In 2016, the AAA stopped conducting surveys about Americans' Labor Day holiday travel plans, saying it sees less travel than on other holiday weekends, but Stigberg said he expects auto travel to be heavy.

With four-fifths of USA petroleum exports consisting of refined products such as gasoline, though, the sharpest impacts will be felt there.

There are still unknowns as far as the impact of the storm on production pipelines, for example. RMS, a company that advises insurers, estimates the cost at $70 billion to $90 billion. "People are still going to be hitting the road this weekend, and prices would normally rise due to supply and demand", Mac said. First, however, the Coast Guard will have to declare the shipping lanes clear, and boat pilots will have to be satisfied it's safe. Rather than sending domestic prices soaring, it will likely keep a lid on them as demand suffers and the outlet of exports gets closed temporarily.