After hurricanes caused price spikes, the price of gasoline is starting to move lower again.
Refinery shutdowns because of Hurricane Harvey and a rush to fill up the tank in advance of Hurricane Irma caused gas prices nationally to soar to an average of $2.78 a gallon.
Tom Kloza, the global head of energy analysis at the Oil Price Information Service in Wall, New Jersey, predicts prices will slip into the two-sixties this month.
“It’s going to take time, and you’ll see some of the off-price places go to it very quickly, the places like Costco and WaWa and so forth. So it’ll happen. It just may be a while before you associate major brands with much cheaper prices.”
Kloza says lower demand for gasoline will help push prices lower.
“Hurricanes destroy a lot of demand and the aftermath of Harvey and the aftermath of Irma suggest that we’re going to lose probably 10 percent of demand at least for a period of six weeks. You know people just generally travel a little bit less after Hurricane impacts.”
Refineries that shut down because of flooding from Hurricane Harvey are coming back on line.
“Most of that refining, save for about a million barrels a day, is returning. And the rest of the world wants to send their gasoline our way because we’re paying the highest wholesale prices in the world right now.”
Kloza believes gas could go as low as two-twenty-five to two-fifty a gallon by the end of the year.