The price on the New York Mercantile Exchange surged 7 percent in overnight trading, signaling upward momentum that is likely to carryover to prices at the pump.
“Hurricane Harvey hit a major supply line for gasoline in Florida and along the eastern seaboard,” said Mark Jenkins, spokesman for AAA. “Multiple refineries and drilling rigs had to be evacuated ahead of the storm, and the Houston Ship Channel was closed.
“There remains a lot of uncertainty in the market. Uncertainty of the extent of the damages, and how long before operations are fully restored. Motorists should expect higher prices this week. It’s still early know how much prices will rise, but a minimum of 10-30 cents would not be a surprise.”
Tennessee gas prices averaged $2.16 Sunday. The state average was 2 cents more than the same time last week.
The most expensive gas price averages in Tennessee were in Memphis at $2.19, Nashville at $2.18 and Johnson City-Kingsport-Bristol at $2.14.
The least expensive gas price averages in Tennessee were in Chattanooga at $2.07, Clarksville-Hopkinsville at $2.09 and Knoxville at $2.14.
One out of every five barrels of gasoline produced in the United States was threatened by Hurricane Harvey. More than a quarter of refining capacity in the U.S. Gulf Coast was offline. The current tally of oil refinery capacity idled by Harvey was estimated at 2,546,700 barrels per day or 28 percent of Gulf Coast capacity. Eight refineries in Texas were in the process of controlled shutdowns.
Other refineries reduced production by an estimated 50 percent to conserve supply due to the closure of the Houston Ship Channel. Further refinery shutdowns are possible, given the extent of flooding and forecasts for heavy rain in the greater Houston-Texas City area.
Valero Energy Corp.’s assessment of storm impacts at its Corpus Christi and Three Rivers sites is that it did not sustain “substantial refinery impacts” due to the storm. The company is working with government agencies and business partners to evaluate logistical measures needed to resume operations, with port operations a particular focus.
The amount of crude oil output shut in at U.S. Gulf of Mexico offshore platforms was estimated at 378,633 barrels per day or 21.64 percent of typical daily production in the region. Five rigs and 105 out of a total of 737 manned platforms were evacuated.