By Labor Day Weekend Oil Prices Could Jump More Than 10 Percent
- Author: Rita Burton Aug 31, 2017,
Aug 31, 2017, 1:09
"Gas prices will go up", said Patrick DeHaan, a senior petroleum analyst with GasBuddy, which provides retail fuel pricing information.
Including the change in gas prices in Modesto during the past week, prices Sunday were 29.6 cents per gallon higher than the same day one year ago and are 5.2 cents per gallon higher than a month ago.
The higher gasoline costs are expected to be around for some time as key refineries along the Texas Gulf Coast were forced to shut down by flooding spawned by Hurricane Harvey, significantly cutting the flow of oil and gas throughout the country.
Gasoline prices are rising as a direct result of Tropical Storm Harvey, and drivers filling up at pumps around the country could soon see an uptick of 15 to 25 cents per gallon.
It could take two weeks or longer before big refineries in the Houston area can recover from a record-setting deluge and resume normal operations.
Mac said the storm is affecting prices not just in Texas but in places like Oklahoma, Colorado and the Carolinas, which also depend on Texas refineries. "Something's got to give, and in this case, prices are going up", DeHaan said.
"I feel bad for all the people over there, so a spike in gas prices here is nothing in comparison", said Kelly Youngblood.
S&P Global Platts Harvey is on track for several more days of torrential rains
The eventual impact to gas prices is likely to be limited by the USA shale oil boom.
Nearly 2 million barrels of refining capacity was taken off line because storm shakes Texas with unprecedented flooding and rain.
At least eight refineries across Texas were offline as of Tuesday afternoon.
All of this means there is a lot less supply of gasoline, leading to higher gas prices.
More than 1,600 US flights had been cancelled by afternoon, majority at the Houston airports, according to tracking service FlightAware.
The good news is that refineries haven't reported major damage thus far and some in Corpus Christi are reportedly trying to start back up.
Inability for workers to get to refineries is a concern.
"One of the trickier challenges is the human impact", said Regina Mayor, global head of energy at KPMG who is based in Houston.More news: Coif (clothing) - WikiVisually