Isaac brings higher gas prices, but Utah mostly spared
Although drivers in Utah are being spared somewhat, their counterparts in many other regions of the country are being hit with the biggest one-day jump in gasoline prices in 18 months just as the last heavy driving weekend of the summer approaches.
As Hurricane Isaac swamps the nation's oil and gas hub along the Gulf Coast, it's delivering sharply higher pump prices to storm-battered residents of Louisiana and Mississippi and also to unsuspecting drivers up north, in Illinois, Indiana and Ohio.
The national average price of a gallon of gas jumped five cents Wednesday, to $3.80, the highest ever for the date. Prices are expected to continue to climb through Labor Day weekend, the end of the summer driving season, before falling back.
"The national average will keep ticking higher, and it's going to be noticeable," said Patrick DeHaan, senior petroleum analyst at Gasbuddy.com.
Utah's prices, however, increased only two cents Wednesday, to $3.67 per gallon. It's difficult to predict exactly what will happen at the pump in the state, given that Utah is in a relatively isolated market that is served by several relatively close refineries.
Also, Utah pump prices tend to move in the opposite way of national trends, sometimes in unexplainable fashion.
Along the Gulf Coast, the wide storm shut down several refineries, and others are operating at reduced rates. In all, about 1.3 million barrels per day of refining capacity is affected. So, it's no surprise that drivers in Louisiana, Alabama, Mississippi and Florida saw gas prices rise by a dime or more in the past week.
But some states in the Midwest are suffering even more dramatic spikes. Ohio prices jumped 14 cents, Indiana's soared 13 cents and Illinois' jumped 10 cents on Wednesday alone, according to the Oil Price Information Service. Days before Isaac is expected to douse those states with rain, the storm forced the shutdown of a pipeline that serves a number of Midwest refineries.
Drivers in the region were angry and confused. "I saw gas in my neighborhood for $3.56 a gallon Tuesday morning, and now I'm paying $3.95. It's terrible," Mary Allen of Cincinnati said Wednesday as she paid $20 for about five gallons of gas. She wondered how Isaac could drive up gas prices in Ohio and then resigned herself to a holiday weekend without travel.
The price surge is happening at the wrong time and the wrong place for Dickson Stewart, a 56-year-old electronics consultant, who is driving from Minneapolis to Savannah, Ga. this week. He stopped at a BP station in downtown Chicago Tuesday home to some of the highest retail prices in the country and paid $4.49 a gallon to fill up his Jeep Wrangler.
Stewart expects gas prices to fall after Labor Day. Analysts say he's probably right, although Utah could be an exception.
As Isaac fades away, the summer driving season ends, and refiners switch to cheaper winter blends of gasoline, station owners in many parts of the country should start dropping prices. "There is some very good relief in sight," DeHaan said.
But in winter, prices often don't fall as much in Utah and other parts of the Intermountain West, leaving drivers locally stuck with costs moving in the opposite direction of the rest of the country.
When Katrina hit in 2005, the national average for gas spiked 40 cents in six days and topped $3 per gallon for the first time. Isaac probably won't have the same result, although its full impact on the refineries is yet to be determined.
The facilities are not expected to suffer long-term damage. But refiners decided to shut down or run at reduced rates to protect their operations.
Gas prices in Utah
Wednesday • $3.67
Week ago • $3.56
Month ago • $3.42
Year ago • $3.54
Record high • $4.22 (July 18, 2008)
Wednesday • $3.80
Week ago • $3.72
Month ago • $3.49
Year ago • $3.61
Record high • $4.11 ( July 17, 2008)
Find low-priced gasoline
Go to UtahGasPrices.com or SaltLakeGasPrices.com