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Neon Tommy - Annenberg digital news

Isaac Likely To Cause Hike In Gas Prices

Danny Lee |
August 27, 2012 | 2:46 p.m. PDT

Executive Producer

Hurricanes in 2005 spiked gas prices about 80 cents per gallon. (Creative Commons)
Hurricanes in 2005 spiked gas prices about 80 cents per gallon. (Creative Commons)
The gathering storm along the Gulf Coast might push prices at the pump yet even higher.

Tropical Storm Isaac could cause the closure of about a dozen refineries as high winds and rain continue to pound the Gulf region. Gas prices could increase 10 cents a gallon or higher over the next few weeks depending on the severity of the storm, USA Today reported.

The region's refineries produce about 22 percent of the nation's gas supplies. The average price nationwide for unleaded gas currently stands at $3.75 a gallon, an increase of 26 cents over the past month due to the closing of oil refineries and lagging production in Illinois and California.

Oil companies with Gulf platforms like BP, Shell and Chevron said they plan to evacuate workers due to the threat from Isaac, according to NBC News.

Federal authorities predicted that 58 percent of oil platforms and 54 percent of oil rigs in the Gulf of Mexico had been evacuated. The biggest concern could be the force of the hurricane once it arrives on shore.

"The major problem following Katrina and Rita was damage to the refineries," said Barbara Shook, senior reporter-at-large for Oil Market Intelligence. "If they stay in one place and just blow and rain, that's what causes the damage."

The Energy Information Administration said the hurricanes of 2005 were responsible for raising the price of wholesale gas about 80 cents per gallon.

 

Read the full story at USA Today or NBC News. For more of Neon Tommy's coverage of Tropical Storm Isaac, click here.

Reach Executive Producer Danny Lee here; follow him here.



 

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