The battering of the U.S. Gulf Coast is shutting in at least ten refineries, which could drive gas prices up sharply. U.S. gasoline futures for September delivery are currently trading at $1.79, up from a recent low on August 17th of $1.55.
Retail gasoline prices are hovering at $2.51 per gallon, still well below all time highs reached in 2008 and 2014 of $4 per gallon.
The Gulf Coast plays a critical refining role in the U.S., hosting operations that account for nearly one-third of the nation’s capacity to turn oil into gas, diesel and other products.
After regional refineries can begin production again, prices should taper off from any short-term surges. Past storms have seen gas prices peak two weeks after landfall.
About 22% of the oil produced in the Gulf was shut down as of Sunday, according to the Interior Department’s Bureau of Safety and Environmental Enforcement. That amounts to nearly 379,000 barrels of oil per day.