Oil Analyst: Gas Prices Will Reach ‘Apocalyptic’ Levels If Hurricane Hits This Summer

Oil Analyst: Gas Prices Will Reach ‘Apocalyptic’ Levels If Hurricane Hits This Summer
Gas prices over the $6.00 mark are advertised at a 76 Station in Santa Monica, Calif., May 26, 2022. (Lucy Nicholson/Reuters)
Jack Phillips
6/24/2022
Updated:
6/24/2022
0:00

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.

“I think for gasoline, we go back above five [dollars per gallon], and ... apocalyptic numbers come into play with hurricanes,” Kloza said. “The thing that people have to watch ... [what] is really insidious for inflation are the values for diesel and jet fuel. Stocks of those fuels are not building. They’re tight internationally, and that’s where … we’re going to have to pay the piper in the last hundred days of the year.”

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.

And when Category 4 Hurricane Harvey hit the Gulf coast in 2017, “at one point, much of the Gulf region’s oil refining capability was shut down, resulting in fuel shortages,” the Office of Fossil Energy and Carbon Management says.
According to data from auto club AAA, regular gas prices remain elevated at $4.92 per gallon on average. Earlier this month, the average price reached $5 per gallon, the first time it has done so in history.
Jack Phillips is a breaking news reporter with 15 years experience who started as a local New York City reporter. Having joined The Epoch Times' news team in 2009, Jack was born and raised near Modesto in California's Central Valley. Follow him on X: https://twitter.com/jackphillips5
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