Last updated on June 13th, 2024 at 04:51 pm
According to the National Association of Convenience Stores (NACS), the severity of Hurricane Harvey has put one-third of U.S. refineries in jeopardy.
Bob Mitchell, president of the Bay Area Houston Economic Partnership, said that Houston-area refineries provide a significant part of the nation’s gasoline, jet aviation fuel and military grade fuel.
As of Aug. 29, Hurricane Harvey had shut down oil refineries in Texas, lowering the nation’s refining capacity by around a sixth. Many analysts predict the price of gasoline will jump between five cents and 15 cents per gallon across the country this fall. Already, the national average price for a gallon of unleaded gasoline has risen to $2.37, four cents higher over the previous week, according to AAA.
“It’s still really early to tell what this is going to mean for long-term supply,” said Denton Cinquegrana, chief oil analyst at Oil Price Information Service, of the shutdowns. “If some of these refineries are flooded, it’s going to take weeks to get the water out of there and then get into damage assessment.”
“As the amount of rain continues to add up, there’s more and more risk that there could be water damage, especially to storage facilities and underground pipelines,” added Patrick DeHaan, senior petroleum analyst at GasBuddy.
Different areas of the country will experience various price jumps, with the Midwest estimated to have a 25-cent increase in gas prices this week because of price cycling (where competing stations lower prices, then reset them mid-week), according to DeHaan.
“Harvey has pushed that price cycling to occur sooner than it usually does,” he said.
