An energy analyst suggested Friday that gas prices may skyrocket even more if a hurricane hits an oil refinery, warning that they may reach “apocalyptic” levels.
“Let’s be candid … what I’m hearing is the progress was on relaxing some of the summer standards for gasoline so that you can put some cheap components in and swell the gasoline pool,” Oil Price Information Service energy analysis global head Tom Kloza told Fox Business.
He added that “I think a lot of refiners would like to see that, that would mean we'd be able to import stuff that doesn’t meet U.S. muster in the summer, and it’s a positive sign ... unfortunately, positive signs between now and … the middle of August may be just overwhelmed if we have an active tropical season.”
While Kloza said he anticipates prices to remain elevated, the situation could become dire if a hurricane or a tropical storm hits or impacts refineries in the Gulf of Mexico.
Catastrophic
Last year, for example, Hurricane Ida made landfall near Port Fourchon, Louisiana, as a Category 4 hurricane in late August, causing 96 percent of crude oil and 94 percent of natural gas production in the Gulf of Mexico region to “shut in,” says the Energy Information Administration. “At least nine refineries shut down or reduced production,” it adds.Between Aug. 27 and Sept. 3, 2021, the agency said that crude oil inventories in the Gulf Coast dropped by about 2.6 million barrels, while crude oil production fell by 1.5 million per day.
About a week later, Hurricane Nicholas hit near Houston, Texas, sparking power outages that shut down two Colonial Pipeline lines, the agency further says. Those lines were shut down for several days.
