Harvey triggers gasoline-price surge just in time for Labor Day

Monday, 04 Sep, 2017

The news immediately sent gasoline prices across the country so a two-year high, Reuters reported Wednesday night.

According to reports, however, the Colonial Pipeline, which supplies almost 40 percent of the South's gasoline, said it may be able to resume operations by Sunday.

Gasoline prices have already been on the rise due to Hurricane Harvey.

The Colonial Pipeline, which stretches up and down the northeast coast, supplies about 100 million gallons of refined gas a day to New York City and other cities all along the coast.

Of the 26 refineries that connect to the Colonial system, 13 are located between Houston and Lake Charles, Louisiana, the fuel distribution company wrote on its website.

Gov. Roy Cooper on Thursday declared a state of emergency in order to allow gasoline to move into and through North Carolina amid delivery problems caused by Hurricane Harvey. The total production capacity of the closed refineries is about 3.04 million barrels a day.

On Wednesday Valero told its East Coast customers that it would stop supplying customers that don't carry its logo at all northeast terminals from Pennsylvania up to ME, according to a customer who asked not to be named because the information isn't public. "As soon as anything happens, boom, gas prices are up". "Right now, it's too early to tell about Colonial Pipeline causing a shortage".

A gas pipeline supplying parts of NY and Washington, D.C., with energy is shutting down as refineries in the Gulf of Mexico go offline amid flooding from Tropical Storm Harvey.

Retail U.S. gasoline prices rose 2.8 percent from Friday to Saturday as refineries warned customers about the fuel-supply shortage. Texas Railroad Commissioner Ryan Sitton addressed the panic Thursday afternoon at a press conference to dispel the gas shortage rumor.

Colonial Pipeline Co., the biggest fuel transporter in the USA, said that "storm-related refinery shut-downs and impact to Colonial's facilities" west of Lake Charles, Louisiana, caused the company to close two of its pipelines.

The bump pushed prices 11 cents higher than last week's average of $2.335 per gallon. The national average is on pace to top $2.50 per gallon, coinciding with the busy Labor Day travel period. Spot gasoline prices on the NYMEX have soared, with the news of Colonial adding another jolt, helping push the market up by more than 25 percent in the past week. Gas prices in Athens ranged Thursday from $2.09-per-gallon to $2.19-per-gallon, according to gasbuddy.com.

"They're probably going to have to take a while to inspect all that, otherwise we could look at another catastrophe", driver Scott Davis said.

Shipments of gasoline by pipeline out of southeast Texas will be reduced, which means that areas along the Atlantic coast and in the Midwest that normally receive these supplies will have to buy from Europe, Africa or Canada, driving up costs and, ultimately, the pump price.

The Department of Energy has released 500,000 barrels of oil from the nation's reserve of crude oil.