As families pick up the pieces after devastating floods in Louisiana, the rest of the nation is likely to escape major impacts on their pocketbooks since the region’s oil refineries escaped major damage.
Flooding and storms in Louisiana and elsewhere along the Gulf Coast have threatened oil refineries without causing major interruptions, analysts say. Still, gasoline prices nationally and locally have risen the past few days, bucking a trend that typically sees numbers at the pump fall as Labor Day approaches.
Though much of the devastation was done to towns and neighborhoods, flooding and foul weather off the Gulf Coast have not gone without notice by the oil companies, GasBuddy.com analyst Patrick DeHaan said.
ExxonMobil idled the fourth-largest refinery in the United States, located in Baton Rouge, Louisiana, because of flooding that threatened an off-site pumping station.
The refinery along the Mississippi River is capable of turning 502,500 barrels of crude daily into gasoline, diesel and other petroleum products.
A Houston refinery operated by LyondellBasell Industries and a Valero refinery in Texas City both were struck by lightning and temporarily shut down operations.
Some of the blame for rising prices could fall on flooding-induced interruptions in the refining process, “but the gist of the latest round of rising gas prices is rising oil prices, which have gone from $39 a barrel to $47 a barrel in a matter of days,” DeHaan said in a phone interview.
The average price for a gallon of regular unleaded locally jumped 3.1 cents during the past week, settling at $1.97 a gallon, according to a report GasBuddy.com released Monday.
This compared with the national average that has increased 3.7 cents per gallon in the past week to $2.16.
GasBuddy.com based its local average on surveys of 124 gasoline outlets in Greater Waco and McLennan County.
The seven-day string of rising prices ended Monday, when West Texas Crude ended the day trading at $47.05 a barrel, a 3 percent decline. Perhaps not coincidentally, the average price for a gallon of regular unleaded in Waco had dropped to $1.96 by early evening Monday.
“We have not seen a lot of Monday-to-Monday increases this summer. In fact, the one we just reported is the first since mid-June,” DeHaan said.
Gregg Laskoski, also an analyst with GasBuddy.com, said the increase could fade as quickly as it arrived.
“While wholesale gasoline prices reflect the run-up to crude, it may be short-lived since the clock is ticking on the rally for retail prices with just two weeks left before the Labor Day weekend and summer’s official end,” when demand begins to decline and retailers look to roll out less expensive gas formulated for winter use, Laskoski said.
Last year at this time, local motorists were paying $2.30 a gallon for regular unleaded, which is 34 cents more than they were shelling out Monday afternoon.
“The natural cycle is for prices to go down heading into Labor Day and for them to tumble after Labor Day, as demand drops,” DeHaan said.
He said Russia and the members of OPEC, the Organization of the Patroleum and Exporting Countries, are scheduled to meet in September to discuss cutting back on production to drive up oil and gasoline prices. But DeHaan said such sessions have come and gone without the countries taking action, “so I’m not holding my breath.”
“But there are a couple of tropical disturbances, including one off the coast of Africa, that are worth watching,” DeHaan said.