That’s not so cut-and-dried this week, as other issues creep to the surface, and into driver’s wallets:
Refinery fire in California: A fire at California’s third-largest oil refinery, which produces 245,000 gallons of gasoline daily, pushed prices up this week. The fire in Chevron’s Richmond facility could keep operations down-and-out for three months, which could crimp supply and drive prices up further. With refineries already closing for maintenance reasons across the state, Californian’s could soon see prices rise to $4 per gallon.
Crude oil prices are on the upswing: On Aug. 1 crude oil prices as measured by the New York Mercantile Exchange stood at $89 per barrel. As of Tuesday, crude prices were flirting with $96 per barrel. Usually, any big gains in oil prices are followed by higher prices at the pump, and that’s the deal this week, oil traders say.
Pipeline rupture in Wisconsin: Further driving up prices, especially in the Midwest (where some gas stations in Chicago were charging $4.20 per gallon) was a rupture in a key Wisconsin oil pipeline that left that Midwest consumers high and dry. The Enbridge Energy pipeline rupture follows a pattern of mishaps by the company, and Uncle Sam has been reviewing the company’s pipeline safety procedures before allowing the pipeline to re-open. It just gave the go-ahead Tuesday, and that should help reduce fuel prices, especially in the Midwest.
While the crude oil prices remain bad news, the California refinery fire and the Wisconsin pipeline shutdown were isolated events – and that’s good for consumers who can’t afford any more surprises at the pump.