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Drivers are facing the biggest one-day jump in gasoline... Drivers are facing the biggest one-day jump in gasoline prices in 18 months (Credit: AP).
NEW YORK -- Drivers are being hit with the biggest one-day jump in gasoline prices in 18 months just as the last heavy driving weekend of the summer approaches.

As Hurricane Isaac swamps the nation's oil and gas hub along the Gulf Coast, it's delivering sharply higher pump prices to storm-battered residents of Louisiana and Mississippi – and also to unsuspecting drivers up north in Illinois, Indiana and Ohio.

The national average price of a gallon of gas jumped almost five cents Wednesday to $3.80, the highest ever for this date. Prices are expected to continue to climb through Labor Day weekend, the end of the summer driving season.

"The national average will keep ticking higher, and it's going to be noticeable," says Patrick DeHaan, senior petroleum analyst at Gasbuddy.com

The wide storm shut down several refineries along the Gulf Coast and others are operating at reduced rates. In all, about 1.3 million barrels per day of refining capacity is affected. So, it's no surprise that drivers in Louisiana, Alabama, Mississippi and Florida saw gas prices rise by a dime or more in the past week.

But some states in the Midwest are suffering even more dramatic spikes. Ohio prices jumped 14 cents, Indiana prices soared 13 cents and Illinois prices jumped 10 cents on Wednesday alone according to the Oil Price Information Service. Days before Isaac is expected to douse those states with rain, the storm forced the shutdown of a pipeline that serves a number of Midwest refineries.
Are you taking a road trip this Labor Day weekend?
Yes 354 (5.6%)
No 5936 (94.4%)


Drivers in the region were angry and confused. ""I saw gas in my neighborhood for $3.56 a gallon just Tuesday morning, and now I'm paying $3.95. It's terrible," said Mary Allen of Cincinnati as she paid $20 for just over five gallons of gas. She wondered how Isaac could drive up gas prices in Ohio – and then resigned herself to a holiday weekend without travel.

The price surge is happening at the wrong time and the wrong place for Dickson Stewart, a 56-year-old electronics consultant, who is driving from Minneapolis to Savannah, Ga. this week. He stopped at a BP station in downtown Chicago Tuesday – home to some of the highest retail prices in the country – and paid $4.49 a gallon to fill up his Jeep Wrangler.

Prices will fall after Labor Day

Stewart expects gas prices to fall after Labor Day. Analysts say he's probably right.

As Isaac fades away, the summer driving season ends, and refiners switch to cheaper winter blends of gasoline, stations owners should start dropping prices. "There is some very good relief in sight," DeHaan says.

When Katrina hit in 2005, the national average for gas spiked 40 cents in six days and topped $3 per gallon for the first time. Isaac likely won't have the same result, though its full impact on the refineries is yet to be determined.

The refineries are not expected to suffer long term damage. But refiners decided to shut down or run at reduced rates to protect their operations.

These facilities consume enormous amounts of electric power and generate steam to cook crude oil into gasoline, diesel, jet fuel and heating oil. If a refinery loses power suddenly, operators can't properly clear the partially cooked oil out of pipes, and re-starting the refinery can take several days or even weeks.

In advance of Isaac, refineries instead conducted what is known as an orderly shutdown, so they can re-start as soon as the power supply is assured again. The Gulf refineries will likely stay off line for about three days.

Isaac cut into the amount of gasoline being produced, and raised fears that supplies could fall dangerously low if the storm proved worse than expected. When supplies drop or are threatened, wholesale prices rise. Then distributors and station owners have to pay more to fill up their station's tanks. They then raise their prices based on how much they paid for their current inventory, how much they think they will have to pay for their next shipment, and, how much their competitors are charging.

Prices spiked particularly high in the Midwest because Isaac forced Shell to close a pipeline that delivers crude from St. James, La. to refineries in the region.

Gasoline prices are particularly vulnerable to spikes around this time of year. Refiners keep a low supply of more expensive blends as driving season ends, knowing they'll soon be able to make cheaper winter blends of gasoline.

"We are really working with a just-in-time delivery system," said Tom Kloza, chief oil analyst at the Oil Price Information Service.

Pump prices were rising before storm

Pump prices were on the rise even before Isaac blew in. The average price for gas rose about 40 cents from July 1 to mid-August because of higher oil prices and refinery problems in the Midwest and West Coast. At $3.80 per gallon, the national average is the highest since May 1 and well above the previous record for Aug. 29, $3.67 in 2008.

Wednesday's jump of a nickel was the 10th biggest one-day jump on record, according to OPIS, and the biggest since the average price rose 6 cents on February 15, 2011 when turmoil in Libya was rising.

But prices could quickly come down if refineries can soon get up and running. Crude oil prices fell Wednesday and wholesale gasoline prices fell the past two days, suggesting the spike in retail gasoline prices could be short-lived. Americans will soon do less driving and the switch to cheaper blends will be well underway by mid-September.

That's still too late for Sharon Simon of Gadsden, Ala. She's driving 900 miles north to her daughter's wedding in Olean, N.Y. this weekend, and will now have to spend an extra $30 to $50 on gasoline for the trip. "Just as we are getting ready to head out the prices go up," she said. "I'm fed up with the surge in price every time there is a holiday."




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  • 490 Comments
      urout48
      • 2 Years Ago
      You've got to be nuts to think that we don"t know we're getting ripped off by the commodes gang. There's no way gas should be going up.
      fhydroracer
      • 2 Years Ago
      USE OUR OWN RECORCES !!!! OIL WILL COME DOWN !!!!!!
      jsm422
      • 2 Years Ago
      Why would this possibly surprise anyone? The price of gas ALWAYS rises just before Labor Day because of a refinery fire, hurricane shutdown, or anyother excuse they can dream up, then comes back down a little after the holiday. Why don't they just tell the truth? They raised the price of gas because THEY CAN.
      racnjag
      • 2 Years Ago
      theres so many greey beatoffs in the petroleum industry why does reg gas go up and not diesel ???? i bet if there were more diesel powered vehicles it would .....they can all suck my a$$
      rusty9354
      • 2 Years Ago
      once again we see profitering. Why is the federal goverment not doing somthing? The gop buddies too strong and have them all quaking in their shoes ?
      Elvis
      • 2 Years Ago
      Ohio gas prices are like .50 cent higher then any surrounding state!
        Oots
        • 2 Years Ago
        @Elvis
        that is i because of pric gouging they will change the prices of gasoline 3 times in one day in Franklin Ohio
      Frank
      • 2 Years Ago
      24 hours after they posted a story about why gas prices are going down? Starting to think someone doesn't want us to drive. A 2000 horsepower Dragster will run on alcohol. I guess its time to start making our own. How hard can it be to build a still? We already run yellow lights, Grow our own weed, And tear the tags off of our matteress. If you want to be free in this country, you risk going to jail. I think freedom is worth it. PS: Cars that have been impounded in Oregon are sold with the provision that they can never be put back on a public road. Crushed a 2003 Mercedes E class yesterday that had 53,000 miles on it. Straight body, nice interior. Gov. doesn't like used cars. It breaks my heart to watch hundreds of nice cars be crushed every week.
      smp276dp
      • 2 Years Ago
      The American people should get together and scare everyone of those F*ing gas speculators. And than get Cantor for giving them the okay to screw ALL the America people.
      Frank
      • 2 Years Ago
      On AOL, This story is followed by 3 listing the best NEW cars, trucks, and a story about a guy in a used car running over children. GEE, got a agenda? If we could organize and EVERYONE stay home and refuse to buy ANYTHING for awhole week. They would be in a hurting place. Lower gas prices and product prices and we go to work. Why work, if 60 hours of your labor doesn't even get you a place to live and a nice car, and maybe some food too.Economy could be fixed by congress overnight but Bad economy gives them all the power. Start bartertown anyone?
      ebaranskijr
      • 2 Years Ago
      You know what is hysterical? They ACTUALLY expected us to swallow that the price has been moving up steadily because of the midwest drought (Yes, they actually said it has affected corn--so it affects gas---BS----maybe a penny--not 50 cents). Anyway, these con artists would find a way to raise them no matter what. Example: let's say we all started driving cars that got 200 mpg by this Monday. Well, they would raise gas to 20 bucks a gallon for some bull&^%$ reason-----------and blame it on a killer whale that ate a seal off of some coast (or something). Anything to gouge us. Bastards.
      • 2 Years Ago
      What a crock of BS, I have a view of the ocean in Phoenix too.
      mikeemo1
      • 2 Years Ago
      hollidays and speculation screw us every time
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