October 24, 2017 10:41:13 AM
It's taken a bit longer than expected, but gasoline prices are returning to their pre-Hurricane Harvey levels, according to Don Redman of AAA.
"As of (Monday), the state-wide average in Mississippi is $2.21 a gallon," Redman said. "So I would say you'll see the prices back to where they were before the hurricane in a week or so."
In some cases, in fact, the prices in the Golden Triangle are even lower than the statewide average of $2.12 on Aug. 28. According to GasBuddy.com, stations in both Columbus and Starkville are selling gas as low as $2.09 per gallon, although the price ranges as high as $2.23 at some retailers.
Gasoline prices rose steadily after Hurricane Harvey swept through Louisiana and Texas in late August, causing shutdowns of refineries that reduced the supply of gasoline and increased prices. In Mississippi, the statewide average peaked at $2.49 about two weeks after the hurricane and have been declining since, Redman said.
"While some of the refineries (went) back to normal operations pretty quickly, you have to remember that oil is sold as a commodity and the uncertainty pushed prices up about the $50-per-barrel level during all the confusion," Redman said. "Now the market has stabilized and crude oil prices are coming back down."
The trend in prices returning to August prices has been temporarily delayed by a market factor that occurs each year -- the transition from the summer blend to fall/winter blends.
"Generally, the gas sold in the summer is a more-refined gasoline, which means it's more expensive to produce," said Matt Bogue, marketing and operations manager for Columbus-based Dutch Oil, which distributes Shell Oil products in the region. "When you go the winter gas, which is not as refined, you have a period where supply is tight because the terminals are changing from one product to the other. That produces a brief spike in prices -- not much -- just a few cents.
"This year, that transition was during all the supply disruption caused by the hurricane," he added.
Barring some unforeseen disruption in production/supply, Redman said fuel prices should continue to fall now that the transition to winter fuel is complete.
"Historically, the lowest prices are in January and February," Redman said. "Based on what we are seeing now, the potential by the end of the year is for prices to be in $2 to $2.10 range. That will put it pretty much in line with what we saw at the same time last year."
Slim Smith is a columnist and feature writer for The Dispatch. His email address is [email protected]
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