OPINION | Barry Richard: Three Reasons Given for Sharp Hike in Gas Prices
Most of us have noticed and commented on the huge spike in gas prices since Hurricane Harvey. Massachusetts saw an increase of 44 cents per gallon for an average of $2.70 according to AAA Northeast. That's the largest week to week increase since Hurricane Katrina.
While many have suggested local retailers were taking advantage of the situation by increasing prices, AAA's Mary Maguire says it's not that simple. Maguire tells the State House News Service the reason for the price hike was three-fold.
First Maguire says 27 percent of the nation's Gulf Coast oil refining capacity was interrupted by Harvey. Secondly, a major pipeline that transports gasoline from the Gulf Region to the Northeast was also damaged. She says damage to the Colonial Pipeline and not a supply shortage is responsible for the price spike. And finally the increased demand for gas on one of the busiest travel weekends also contributed.
Maguire says repairs to the refineries and the pipeline are being made and and prices should go back to normal before much longer. As of yesterday four Gulf refineries were on partial capacity and eight others were in the process of being restarted.
As we pointed out yesterday some area stations had already begun dropping prices dramatically. Depending upon what Hurricane Irma does...well, we'll just leave that one there and hope for the best.
I don't like paying higher prices either but I appreciate a plausible explanation for why it happened.
Editor's Note: Barry Richard is the afternoon host on 1420 WBSM New Bedford. He can be heard weekdays from Noon-3pm. The opinions expressed in this commentary are solely those of the author.