At least 3.6 million barrels per day (bpd) of refining capacity is offline and more refineries are at risk of shut downs as the storm relentlessly dumps rain on Texas and heads toward Louisiana.
The longer refineries remain shut, the more retail prices will increase, traders and analysts said. Two of the major pipelines delivering gasoline, diesel and jet fuel from the Gulf Coast are operating at reduced rates or plan to shut entirely, with wholesale markets in Chicago and the Gulf region seeing sharply higher prices.
“Basically this will affect everyone across the country on some level and your proximity to the supply chain will affect how severe the impact is to you,” said Jeff Lenard, NACS vice president of strategic industry initiatives, which represents 80 percent of all gasoline volume sold in the country.
In 2016, about 143.37 billion gallons (or about 3.41 billion barrels) of finished motor gasoline were consumed in the United States, according to the U.S. Department of Energy. That translates to a daily average of about 391.73 million gallons (or about 9.33 million barrels per day).
The national average gas price has increased three cents since Friday, according to the American Automobile Association (AAA), the country’s largest motorists’ advocacy group. Analysts said that it could take a few days to weeks for price increases to be fully reflected at the pump.
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States likely to see the largest price increases are Texas, Louisiana, Arkansas, and Tennessee, AAA said. Prices are already up by six cents a gallon in Washington, D.C., Georgia and South Carolina since Friday, when the national average was about $2.35 a gallon.
On Tuesday, the national average was $2.378 a gallon, according to AAA.
Across Houston last week, motorists refuelled before Hurricane Harvey struck, leaving many gas stations with empty tanks.
Some fuel terminals in the Houston area were beginning to reopen with limited product, said Jesus Azanza, a spokesman at Texas Food & Fuel Association, a trade group representing more than 12,000 convenience stores and truck stops.
The refuelling process is slow, however, leaving some trucks waiting more than four hours to refuel, he said. Depots in some areas were inaccessible due to floods.
“One of our members today attempted to load a truck, spent 5.5 hours waiting only to discover the bulk plant had run out of fuel. Crazy times!” Azanza said.
On a normal day, the average time spent at the truck rack is about an hour.
Even after the storm passes and refineries restart, roads damaged by flood waters and obstructed by trees and debris, could impede delivery for some time.
Pipeline delivery is being throttled back due to the storm. The Explorer Pipeline, which hauls about 660,000 barrels a day of gasoline, diesel, fuel oil and jet fuel from the Gulf Coast to the Midwest, was due to shut its main lines on Wednesday.