NEW YORK (MainStreet) -- If it seems like gas prices are out of your control for a host of frustrating reasons -- from speculators in the oil market to geopolitical conflicts in the Middle East and pipeline incidents in Africa -- how about the weather, as in, extreme weather, the acts of god, from deluges to drought-plagued croplands, that are playing a much bigger role in the recent gas price action.
It’s the beginning of hurricane season, and a category five storm raging in the Gulf of Mexico or up the Atlantic sea coast has the capacity to shut rigs and refineries and drive up gas prices across the country.
Hurricane season is an issue for the oil market every year with the concentration of storms in the Gulf of Mexico, and often, it turns out to be much ado about nothing. One of the few times that the federal government's Strategic Petroleum Reserve was tapped did occur after Hurricane Katrina, but more often than not the ominous hurricane bands spotted on the Weather Channel don't turn out to take out the rigs or refineries, weakening enough or changing course just enough to spare U.S. drivers.
Of course you never know, but this year the natural disaster that has taken center stage is the opposite of too much rain. It's the severe drought occurring across the Midwest. With a lack of rain, corn grows scarcer, and more expensive. By law, corn-based ethanol comprises 10% of the mix in the gasoline U.S. consumers buy, and with corn crops waning this summer and the price of corn skyrocketing on a 10-year low yield, the drought is having a big impact on the price of gasoline. AAA says gas prices rose by 5% in July, largely in part to the drought conditions in the Midwest.
U.S. gasoline prices have continued their slow move up in the past week, the fourth consecutive week of higher gasoline prices.
Overall, U.S. gas prices rose from $3.49 per gallon to $3.51 per gallon, with only Rocky Mountain drivers catching a break, as prices slid from $3.49 to $3.47 per gallon along the contintental divide last week.
Gas prices along the East Coast and Gulf Coast, and in the U.S. Midwest all rose, but none more than three cents per gallon, according to U.S. government figures. Gasoline prices in the West Coast were flat (though way above the national average) for the second straight week, according to the U.S. Energy Information Administration.
Here is the exact data:
On the East Coast the gas price rose from $3.49 to $3.50.
In the Midwest, the gas price rose from $3.48 to $3.51.
Along the Gulf Coast, gas prices went up from $3.29 to $3.31.
In the Rocky Mountain region, the nation's lone decliner, the price dropped from $3.49 to $3.47.
The West Coast gas price was flat week-over-week at $3.71.
And hurricane season is just getting started, which can change a slow crawl up into a sudden pricing tempest. Meteorologists are already tracking Tropical Storm Ernesto, which could reach hurricane force as it makes its way toward Jamaica early next week. It’s too early to say how Ernesto is shaping up, but any sizeable hurricane can drive gas prices up over the short term, so consumers may want to keep an eye on the storm over the next few days. As if there wasn't enough to worry about already with the recent resurgence of gas prices and general state of the economy.
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