HEATHROW, Fla. -- Tropical storm Harvey is affecting gasoline prices far beyond Texas. In one of this summer’s largest week-over-week increases, the national average retail price for gasoline hit $2.37 on Aug. 28, a 4-cent-per-gallon (CPG) jump, according to AAA.
The price increase comes as Harvey—which hit Texas as a Category 4 hurricane but has since been downgraded to a tropical storm—has forced about 2.5 million barrels per day (bpd) or one-quarter of the Gulf Coast’s refining capacity offline, according to the Oil Price Information Service (OPIS). Eight refineries shut down in response to the hurricane, led by ExxonMobil’s 584,000-bpd refinery in Baytown, Texas. Other refineries are running at lower rates, and three facilities have been offline since shutting down in anticipation of the storm last week.
Jeanette Casselano, a spokesperson for AAA, said the extent of damage to refineries in the region is still unknown. “Despite the country’s overall oil and gasoline inventories being at or above five-year highs, until there is a clear picture of damage and an idea when refineries can return to full operational status, gas prices will continue to increase,” she said.
As of Monday morning, the section of the Colonial Pipeline that brings gasoline from Houston to the mid-Atlantic region was still operating normally. Magellan Midstream Partners, however, had suspended refined product and oil shipments on its Houston-area pipelines area over the weekend.
The U.S. Environmental Protection Agency (EPA) waived local environmental regulations on gasoline for some Texas counties to help ease possible fuel shortages.
Texas’ retail gasoline average rose 4 CPG week over week, although this was not the greatest increase. Indiana led the nation in the largest weekly change, with an 11-CPG jump, followed by Ohio (9 CPG), Florida (7 CPG), Michigan (7 CPG), Illinois (6 CPG), Washington (6 CPG), Georgia (5 CPG), South Carolina (5 CPG) and Washington, D.C. (4 CPG).
Texas’ retail average as of Aug. 28 was $2.17 per gallon, placing it among the top 10 least expensive states, according to AAA. Pump prices in Houston rose 4 CPG week over week, thanks to heavy demand from residents filling up before the hurricane was set to hit. But in Corpus Christi, Harvey has eroded demand to the point that the local average was 1 CPG lower.
The lowest retail averages as of Aug. 28 were in South Carolina ($2.11), followed by Alabama, Arkansas and Mississippi, each at $2.12 per gallon. Hawaii had the highest retail average at $3.09 per gallon, followed by California at $2.99.
South Carolina may not have the lowest average for long, however. Tropical Storm Irma was poised to land along the Carolinas’ coasts at the beginning of this week, and it could potentially pressure wholesale and retail prices, AAA reported.