One analyst predicts gasoline prices in Iowa could rise between 10 and 25-cents a gallon over the next week or two because of Hurricane Harvey.
Gail Weinholzer, spokeswoman for AAA-Iowa, says oil rigs in the Gulf of Mexico were shut down as a precaution as the massive storm approached and they’ll reopen soon. The problem is — the historic storm is still causing big troubles inland.
“The storm is hovering over Houston and the southeastern part of Texas where a lot of refineries are,” Weinholzer says. “They obviously will not restart until it’s safe to do so.” The storm, which is blamed in several deaths, is causing widespread flooding in Texas and Louisiana and may force the evacuation of 30,000 people. The significant disruption to those key oil producing areas will be felt far away, even in Iowa.
“While there will be absolutely no shortage of fuel, there will be a tightening of supply,” Weinholzer says. “That will have an impact not only on the national prices and the regional prices in Texas but it will ripple up through much of the United States.” Gas prices in Iowa are now averaging $2.30 a gallon while nationwide, it’s $2.37 a gallon.
“I would expect those numbers to increase anywhere from a dime to a quarter over the next couple of weeks,” Weinholzer says, “because, of course, we also have increased demand for the rest of the nation that’s heading into the Labor Day weekend.”
While the storm’s impact won’t be as devastating as Hurricane Katrina 12 years ago, Weinholzer says it will still likely affect gas prices into mid or late September.