Isaac was upgraded to hurricane status yesterday. And as it continues its path inland, it’s not just the Gulf Coast states that will be affected by the storm.
Residents of other states have felt the pain at the gas pumps, as well.
According to Reuters’ Sasha Salama, “The government says the average price at the pump is already up to $3.78 a gallon – with analysts telling me gas could go even higher by Labor Day. Here in New York, drivers are paying more than $4 a gallon.”
Last Monday, Jason Simpkins broke down why he’s convinced gas prices will continue to soar. One reason was bad weather. “This year’s hurricane season is expected to be busier than normal, due to higher-than-average ocean temperatures,” he says. “That could damage – or temporarily halt – oilrigs operating in the Gulf of Mexico, further jeopardizing supplies.”
And that’s exactly what’s happening now.
The Gulf Coast evacuated offshore rigs and closed refineries as Isaac approached. Increased fears of a supply strain sent oil prices higher.
Ira Eckstein, President of Area International Trading, says, “As of right now, with supply concerns, especially with refinery utilization, I think this is going to be a little tight… $100 will be the next level of crude oil and then $105, $110.”
Analysts don’t expect the impact on prices to be as severe as Katrina, of course. But NOAA expects to see up to five more hurricanes hit this year.