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Gas prices likely to jump as Hurricane Ida affects gasoline production along Gulf Coast

Gas prices likely to jump as Hurricane Ida affects gasoline production along Gulf Coast

FINANCIAL NEWS

Gas prices likely to jump as Hurricane Ida affects gasoline production along Gulf Coast

Winds rip through Houma, La. as Hurricane Ida advancesFootage taken from a backyard in Houma, Louisiana, shows raging winds and rain from Hurricane Ida.Chad DucoteHurricane Ida brought gasoline refining and oil production to a halt along much of the Gulf Coast in a development that will likely cause the national price of gasoline to jump in the coming days.While experts don’t expect the hurricane to have devastating effects on the availability or price of fuel, they say motorists should still brace for increased prices at the pump.Think somewhere in the range of 5 to 15 cents per gallon more than what you’re currently paying, said Patrick De Haan, head of petroleum analysis for GasBuddy, a fuel-savings app.The national average was $3.15 on Monday, down 1 cent from a week earlier but up 92 cents from a year earlier, according to AAA.”We have seen three weeks of falling prices but that will probably end this week,” he said.The effect is likely to be spread out, and the increases will likely take effect over the next two weeks, De Haan predicted.Ida is sweeping through an area of the country with significant gasoline production capacity and petroleum extraction.Shell, Phillips 66 and Exxon were among the energy companies that temporarily closed refineries in advance of the storm.About 96% of the oil production in the Gulf of Mexico was also shuttered in anticipation of the hurricane, according to the U.S. Bureau of Safety and Environmental Enforcement.Hurricane Ida: I-10 cleanupCrews remove trees and clean up other damage on Interstate 10 east between mile markers 181-182 in Gonzales after Hurricane Ida moved through the state Sunday.Lafayette Daily AdvertiserAs the storm subsides, refineries and oil rigs will begin to assess damages. The outcome of those assessments could lead to additional downtime.”The biggest concern is probably not so much the wind but the flooding,” De Haan said. “Refineries are built pretty solid right now, but one thing they can’t really plan around is the rain.”Another factor: the Colonial Pipeline. The key piece of oil transportation infrastructure –  which was famously down for days earlier this year due to a ransomware attack that led to gasoline shortages along the East Coast – was briefly taken offline as Ida made landfall.Renting an apartment?: Rents during COVID are already high and they are only going higherCostco deals: Here’s the key to saving money so you can buy more $1.50 hot-dog-and-soda combosBut that downtime is expected to end imminently.”I think they’ll get back online later today,” De Haan said Monday morning, though he acknowledged that further downtime is not out of the question.He said motorists should not be concerned about experiencing shortages of fuel like what happened with the Colonial Pipeline outage.But the economy’s bounce back after 2020’s pandemic-caused doldrums, the Colonial Pipeline issues and the Hurricane Ida effect are collectively poised to make 2021 the most expensive summer at the pump since 2014, De Haan said.You can follow USA TODAY reporter Nathan Bomey on Twitter @NathanBomey and subscribe to our free Daily Money newsletter here for personal finance tips and business news every Monday through Friday morning.


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