Rising waters at oil refineries on the Gulf Coast has gas prices rising in the tri-state.
Drivers in New Jersey are noticing gas has gotten more expensive in the wake of Harvey, the deadly storm that has inundated large swaths of southern Texas and Louisiana, a major hub for U.S. oil companies.
“I just noticed it’s up to $2.69, which is quite a jump,” Charlie Hantke said.
Robert Sinclair, of American Automobile Association of New York and New Jersey, says electricity is the problem.
“Flooding knocks electricity out. Without electricity, the pumping stations and pipelines aren’t running. That leads to shutdowns, shortages and price spikes,” Sinclair said.
For drivers who plan to travel for the upcoming Labor Day holiday weekend, there are few options but to pay up.
“Gas is gas,” said Yechael Walkman. “Need it every day no matter what the cost is.”
The average price for gas in New Jersey on Thursday was $2.46 — up 5 cents overnight, and up nearly 10 cents from last week.
Drivers are likely to see gas prices increase up to 15 cents in the coming week leading into September, according to AAA.
However, the automobile organization expects prices to drop by late September, when refineries and pipelines should be back online and the cheaper winter blend of gasoline will be in service.
The U.S. Energy Department announced Tuesday it will release half a million barrels of crude oil from the nation’s Strategic Petroleum Reserve as Harvey continued to wreak havoc on U.S. oil production and gas prices remained on the rise.
The supply — the first emergency release since 2012 — won’t give drivers much relief at the pump ahead of the Labor Day weekend, one of the top travel weekends of the year.
Retail gas prices in the U.S. climbed another 4 cents Thursday, and 10 cents in the past week to a national average of $2.449 per gallon, according to AAA. The organization said that is one of the summer’s largest one-week price surges.
In North Texas, drivers reported fuel prices as high as $8.02 per gallon, NBC DFW reported.
Patrick DeHaan, an analyst for GasBuddy, predicts that U.S. gasoline prices will top out around $2.50 or $2.55 a gallon, an increase of up to 20 cents since Harvey hit, with bigger spikes closer to the Gulf.
“In terms of product price increases, it might get worse before it gets better,” Rob Smith, an energy analyst with IHS Markit, told The Associated Press.
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, assuming they didn’t suffer serious damage, which is still unknown.
With Americans using about 9.7 million barrels per day of gasoline, the threat of a fuel supply crunch has grown as the storm and flooding in Harvey’s aftermath brought a huge chunk of U.S. oil production and refining capacity to a halt.
As of Thursday, some 15 refineries representing about 25 percent of U.S. refining capacity were offline from Corpus Christi, Texas, to Port Arthur, Texas, the Energy Department reported.
Published 2 hours ago | Updated 5 minutes ago