AAA: Hurricane Ida Likely To Cause Higher Gas Prices

4 weeks ago 13
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MIAMI (CBSMiami) — Florida drivers could soon consciousness the effects of Hurricane Ida, successful the signifier of higher state prices. While a state terms hike appears imminent, it’s inactive unclear however overmuch of a summation drivers volition see.

The mean terms for gasoline successful Florida is $2.95 per gallon. The authorities mean has dilatory declined implicit the people of the past 3 weeks, aft mounting a caller 2021 precocious of $3.03 connected August 5th. A week ago, it appeared that prices were poised to diminution adjacent further, aft futures prices plummeted, successful effect to the dispersed of COVID-19. However, futures prices rebounded past week, owed to concerns astir what the tempest could bash to the Gulf Coast substance proviso chain. Sunday night, futures prices spiked again successful overnight trading.

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Importance of the Gulf Coast 

Hurricanes don’t ever origin state prices to rise, but erstwhile a large tempest moves into the Gulf Coast, that’s different story. Hurricane Ida made landfall on the Gulf Coast, a portion populated with offshore lipid rigs, coastal crude lipid refineries, terminals and ports.

Refineries successful Louisiana, Mississippi, Texas and Alabama account for much than 45% of the nation’s capacity for refining crude lipid into gasoline and different important products. Additionally, the portion is location to astir 2,000 offshore oil platforms, which accounts for 17% of the nation’s crude lipid production.

Initial Storm Impacts:

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  • Nine refineries were successful Ida’s forecasted way – 24% of Gulf Coast refining capacity; 13% of capableness nationwide. Four refineries safely unopen down earlier the storm. Another 1 reduced operations.
  • More than 90% of offshore lipid rigs successful the Gulf of Mexico were unopen down and evacuated earlier the storm. That amounts to 15% of US production.
  • Colonial Pipeline – which carries diesel and gasoline from Texas to states on the eastbound seaboard – was unopen down connected Sunday arsenic a precaution.

“Drivers volition astir assuredly spot state prices emergence this week, due to the fact that of Hurricane Ida’s effects connected the Gulf Coast,” said Mark Jenkins, spokesman, AAA – The Auto Club Group. “Based connected overnight question successful the futures market, a 10-20 cent leap astatine the pump is not retired of the question. Where state prices spell from present volition beryllium connected the grade of the harm and how agelong it volition instrumentality for substance accumulation and proscription lines to instrumentality to normal.”

Florida’s Fuel Supply Chain

Most of Florida’s gasoline sails into its ports from refineries successful Texas, Louisiana and Mississippi connected waterborne vessels. It’s imaginable immoderate substance shipments volition beryllium interrupted oregon delayed due to the fact that of the storm. However, the authorities tin besides bid connected shipments from different countries.

State leaders are reportedly filing for a waiver from the EPA to statesman selling wintertime blend gasoline now. The EPA usually restricts retailers from selling wintertime gasoline until September 15. However, if allowed, this would alteration retailers to bring successful some summertime and wintertime gasoline, expanding entree to gasoline astatine a clip erstwhile supplies could tighten.

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Regional Prices

  • Most costly metro markets – West Palm Beach-Boca Raton ($3.12), Panama City ($3.07), Tallahassee ($3.05)
  • Least costly metro markets – Punta Gorda ($2.80), Tampa-St. Petersburg-Clearwater ($2.87), Orlando ($2.88)

CBSMiami.com Team

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