Woes at refineries push gas prices up
By USA Today
Published: Saturday, May 18, 2013, 6:39 p.m.
Troubles at several oil refineries are driving gasoline prices sharply higher in the Midwest, and the regional shortages are expected to boost pump prices nationwide.
Gas prices in Minnesota, Iowa, Missouri, North Dakota, South Dakota, Nebraska, Ohio, Oklahoma and Wisconsin have spiked as much as 43 cents a gallon the past week alone. Behind the rise: outages and extended maintenance, which have curbed output at refineries in Joliet, Ill., Whiting, Ind.; Tulsa, Okla.; and Eldorado, Kansas.
While the U.S. may be dripping in new found crude oil deposits and early May supplies were at their highest levels since the early 1930s, issues at a handful of refineries that turn crude into gasoline and diesel fuel underscore how kinks in the supply chain can cause quick surges in what consumers pay at the pump.
Minnesota is particularly hard hit. Regular-grade gas averages $4.26 a gallon this weekend — another state record after spiking to $4.15 Friday. That makes Minnesota second only to Hawaii — averaging $4.36 — for the nation's highest-priced gasoline. Oil-rich North Dakota, averaging a record $4.13, is third, ahead of California ($4.06), usually the priciest in the continental United States.
“It's amazing what problems refinery issues can cause,” said Patrick DeHaan, senior analyst for price tracker gasbuddy.com. “If another refinery went down, all hell would break loose.
Nebraska, Iowa and Oklahoma could soon set record-highs, DeHaan said.
Nationally, prices average $3.64 a gallon this weekend after beginning 2013 at $3.29. Some industry observers thought this year's prices had peaked at $3.78 in February after sliding to $3.50 April 29. But the Midwest's refinery issues are now expected to propel prices for several weeks, perhaps to $3.85 a gallon nationwide.
“Supplies were already low in the Midwest — that's why we're seeing such a dramatic increase. While this is a regional problem, it's definitely going to push overall prices up — no doubt about it,” said Brian Milne of energy adviser Schneider Electric.
The price surge in the Midwest could have a broader economic impact. Thursday, the Labor Department said April's drop in gas prices helped push consumer inflation down 0.4% Earlier this week, the Commerce Department cited lower-priced gas for spurring a slight gain in April consumer spending.
Rising gas prices likely will reverse both trends, however.
“In each of the last two years, 60 percent of Americans said they cut back on discretionary spending when gas prices rise,” said Greg McBride, senior financial analyst for Bankrate.com. “There's no reason to expect a different result in 2013. And any surge in gas prices would further detract from meager economic growth.”
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Defense bill gets House OK, deals with sexual assault
- Boehner’s rant brings budget deal
- Plane crash kills Hawaii official in Obama’s ‘birther’ fuss
- Fawcett bling tops Kelly’s ‘Singin’ in the Rain’ suit
- Missing American in Iran was on unapproved CIA mission
- Bipartisan Senate bill would put kibosh on pricey portraits
- New wife pleads guilty in husband’s cliff death
- Feds to collect public comment on plan to permit cellphone service on airplanes
- Veteran accused oflifting peers’ IDs
- Commuter railroad in Bronx crash to undergo federal scrutiny
- Colo. boy, 6, no longer guilty of ‘sexual harassment’