BOSTON — GasBuddy reports nearly 1,800 gas stations in Texas are without power this afternoon and warns of higher gas prices as states continue to deal with severe winter weather.
The national average price of gasoline may jump 10-20 cents per gallon from its current price of $2.54 per gallon over the next two weeks as millions of barrels of refining capacity has gone offline due to the extreme cold in the South, with little relief on the horizon as overall gasoline demand continues to recover from the COVID-19 pandemic, according to GasBuddy.
Such an increase in prices could lead the national average to rise to $2.65-$2.75 per gallon, resulting in the highest prices since 2019 and the highest seasonal prices in over five years.
Patrick De Haan, head of petroleum analysis for GasBuddy, tweeted Friday morning that 12.5%, or roughly 1,763 gas stations were without fuel or power in Texas. By early afternoon that number had grown to 13%.
Pilot Co., TravelCenters of America and Love’s Travel Stops & Country Stores each announced a long list of store closures, reports of delayed deliveries and loss of water. Most of the outages and closures are in Texas, but some stores in Louisiana, Arkansas, Mississippi, Tennessee and Oklahoma have also been affected.
According to GasBuddy’s analysis, 11 refineries in Texas and one in Kansas have at least partially shut due to the extremely cold weather. Refineries are exposed to the elements, and unlike facilities in the northern United States that are prepared for cold weather, few refineries in the South have protection from these historically low temperatures. GasBuddy calculations show 3.48 million barrels of refining capacity were offline as of midday Tuesday, or nearly 20% of total U.S. refining capacity, just under the amount shut down due to Hurricane Harvey in 2017. Every day that these refineries are not operating the country is consuming more gasoline than it produces, swiftly affecting inventories.
“Expect gas prices to rise more closer to the markets these refineries serve, primarily Texas, Louisiana, Alabama, Mississippi, Florida, Georgia, the Carolinas and potentially even up the coast, as the Colonial pipeline carries refined products from the affected refineries as far as New Jersey. While other regions are also likely to see impacts to gas prices, the amount may be slightly less,” said De Haan. “Even after this event is over, it may take refineries days or even a week or two to fully return to service, and with gasoline demand likely to accelerate as we approach March and April, the price increases may not quickly fade.”
Boston-based GasBuddy expects the national average could rise closer to $3 per gallon nearer to Memorial Day weekend as refineries eventually begin to switch over to EPA-mandated cleaner summer fuels. GasBuddy also reports that the market could cool down should OPEC, which controls a third of global oil production, raise production in the weeks or months ahead.