Gasoline prices passed new milestones today as the damage caused by Hurricane Harvey continued to mount.
Flooding from the storm, now downgraded from hurricane status, has caused nearly a quarter of US refineries, producing 4.4m barrels per day, to go offline. That pushed gasoline prices above $2 a gallon for the first time since July 2015 over supply concerns.
Meanwhile, crude prices have stabilised somewhat after losing more than $1 yesterday as demand dropped. Global benchmark Brent crude futures were down 0.14 per cent to $50.79 per barrel while West Texas Intermediate (WTI) futures, the US benchmark, fell 0.11 per cent to $45.91 per barrel.
Goldman Sachs said it could take several months before all production comes back online, according to Reuters, and research from BMI said more damage could be on the way.
"As Harvey heads inland once again, we note a number of refineries in its current trajectory will be under threat. This could close up to another 824,000 barrels per day (bpd) of capacity, giving an additional lift to fuel prices, while further depressing crude," BMI said.