Will Sandy affect gasoline prices?

It might seem hard to believe, but some experts say an extreme drop in demand along the East Coast could decrease prices at the pump.

By Kim Peterson Oct 29, 2012 5:35PM
Updated 2 p.m. ET Tuesday

Just when gas prices were starting to calm down, along comes Sandy to throw the sector into rain-soaked turmoil.

Although some parts of the East Coast saw the price of gas spike over the weekend and Monday, it's very likely that Sandy will cause prices to fall. That's because no one wants to be out driving in the pouring rain and heavy wind, so demand will see a sudden and intense drop.
But there are a few more pieces to this puzzle. Fuel deliveries have also slowed to a crawl, which may cause some shortages. Also affecting supply are refinery closures along the East Coast. About 70% of the refiners in the region are expected to close, but Reuters reports that as checks begin, the biggest East Coast refiner in Philadelphia appears unharmed.

The Phillips 66 Bayway refinery in Linden, N.J. lost power late Monday. The No. 2 refinery on the East Coast had already shut down operations, Reuters reports. Power is expected to be restored within the next two days.

East Coast refineries don't produce much gasoline for the U.S. CBS News reports that the refineries contribute just 6.5% of the country's gas supply. In fact, the Northeast needs to bring in gas from the Midwest, the Gulf region and other countries to keep up with demand.Image: Gas prices (Photodisc/SuperStock)

So the general consensus is that yes, supply will take a hit, but demand will likely take an even bigger hit.

The price of gas nationwide has fallen every day since Oct. 8, Bloomberg reports. The average price for a gallon Monday was $3.53, AAA reported, down 25 cents from a month ago.

"We were on a steady road toward cheaper U.S. gasoline prices nationwide," Tom Kloza, chief oil analyst at the Oil Price Information Service, told MarketWatch Monday. "Prices will resume a strong downward bias in November."

AAA says that gas prices are forecast to fall this week and through the Thanksgiving holiday, according to The Christian Science Monitor.

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157Comments
Oct 29, 2012 7:25PM
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Supply and demand?

Is this a joke?  History says gas price will go up. Every excuse will be use to raise gas price.
Oct 30, 2012 10:18AM
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Any Escuse. Every time there has been a hurricane in the gulf, prices went up.  Fire at one refinery, prices went up.  Drought in Texas, prices went up. Fires in Iraq during Desert Storm, Prices went up. Exxon Valdez, Prices went up. The gulf spill, Prices went up.  Also they don't just go up in the affected areas, they go up nation wide. Exxon Valdez was in Alaska but Florida prices went up.  Katrina was in Louisana but prices went up on the west coast. There will never be an end to the price gouging excuses to filling up the pockets of big oil execs.
Oct 30, 2012 10:46AM
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During the 1950's gas was 18.9 cents a gallon, we were independent of the world and produced more gas the we could use. Government regulations and profits have increased the cost to almost $4.00 a gallon, our government and speculators have destroyed our economy with their greed and regulations. Just about all products and food depend on energy production and price. Since the 1960's the government has passed regulations that make domestic oil production more expensive for the consumer. There is no reason why gas should cost more than $1.00 a gallon, except for corruption and mismanagement of our resources by the government and the speculators. The government owns almost 1/3 of the land area in the U.S. and has restricted drilling on land and offshore deposits. Our country needs a manager, not a politician who is bankrupting our country.
Oct 29, 2012 7:08PM
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Prices will never drop ! More BULL "S " from the Spin Masters ! Prices will increase just in time for the HOLIDAYS !
Oct 30, 2012 10:47AM
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Whether Sandy directly affects gas prices or not, it will be used as an excuse to raise them.
Oct 29, 2012 6:19PM
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interesting.  but i'll believe it when i see prices drop.  because they seldom do
Oct 30, 2012 10:19AM
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One of these days the government needs to put a stop to gouging. Every there is a natural disaster oil companies and major retail sources feel that they need to make as much money as possible. In times of disasters price freezes should be put into place. Some may not agree but as a Christian business owner, I can tell you that money is worthless and people mean everything.
Oct 30, 2012 10:32AM
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everytime there is a threat of a storm gas prices soar

 

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Wake up everyone and learn about one of the biggest lies told to people.  Look up abiotic oil.  Oil is NOT fossil fuel.  It is not made by living material after thousands and millions of years.  We will not run out.  The earth takes in Hydrogen and puts out this abiotic oil.  Oil that is made from inorganic material.  The price of oil was decided to be manipulated indefinitely during the Rockefeller meeting in the late 1800's.  If you go back to a empty oil well a few decades later, you will find OIL again.   If you think it is actually made from fossils, why on earth do we drill so much at depths that geologists will tell you is absolutely too low to find fossilized creatures?

 

Educate yourselves.  Keep Calm.  Spread Truth.

Oct 30, 2012 10:53AM
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If the sun comes up, so does the price of gas!
Oct 29, 2012 10:01PM
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Obama Curtails Drilling in Oil-Rich Alaskan Reserve

The Obama administration, citing environmental concerns, has banned drilling on half of the vast National Petroleum Reserve-Alaska in a move decried even by Alaska’s congressional delegation.

“The price of gasoline, which was $1.84 a gallon the day President Obama took office, has more than doubled since, willfully aided and abetted by an administration that claims we can't drill our way to energy independence as we ignore vast reserves of North American energy that dwarf OPEC's and we sit on 100 years' supply of petroleum,” Investor’s Business Daily (IBD) stated in an editorial.

The National Petroleum Reserve-Alaska (NPRA), not to be confused with the Arctic National Wildlife Refuge (ANWR) to the east, is a 23.5-million-acre, Indiana-sized tract on Alaska’s North Slope. It was established by President Harding in 1923 to ensure oil supplies for the U.S. Navy.

Oct 30, 2012 10:56AM
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You asked, will the storm affect gas prces? Can a cat scratch? The motorist and every

consumer is at the hands of the greedy. We are the puppets being manipulated by the

puppeteer.

Oct 30, 2012 10:53AM
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This is another prime excuse for them to further raise the price. Less demand on the East Coast because of the destruction from Sandy going to lower the price? Give us a break from the BS. That will be twisted into another lie as to why it went up.
Oct 30, 2012 11:07AM
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Why is it any time there is a hurricane or storm (or even in anticipation of the summer hurricane season) gas prices go up? However, this one they are coming down. Could it be the election next week? Very strange! Just a fleecing of the American public as always.
Oct 30, 2012 10:05AM
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I paid 3,15 a gallon yesterday. still to high, but better then the 3.89 i was paying a month ago
Oct 30, 2012 11:35AM
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They use EVERY excuse to raise gas prices. It's the one thing they do consistently, it's a way to control people. keep them immobile and you can start to control them. Control the economy, keep it crappy and then you gain control. Wake up people. 
Oct 30, 2012 11:10AM
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Sure that Storm was Huge, But I cannot believe it would be able to keep elevating Fuel prices if there is no Damage to the oil Refineries Infustructure? At the Worst it might slow it, but if not harmed the prices should go back to falling with the price of crude?
Oct 30, 2012 11:23AM
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ONE QUESTIONTHAT NEVER GETS ASKED, " WHERE DOES THE ELECTRIC COME FROM TO CHARGE THE CAR BATTERIES?"  80% COMES FROM COAL............IF WE CANT MINE COAL (OBAMA IS KILLING THAT INDUSTRY IN WVA.) THEN I GUESS WE BURN OIL TO CREATE THE ELECTRICITY TO CHARGE THE CAR BATTERIES............THE CIRCLE IS NOW COMPLETE!

Oct 30, 2012 10:58AM
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What have we learned from 911 ?     The complete countires markets shut down because of a small portion of the country is affected by bad weather ????   

And our economy will change ?

 

Oct 30, 2012 10:41AM
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HEY BIG NEW YORK AND EAST COAST LIBERALS USE SOME OF OBAMAS GREEN
ENERGY PLAN!!! ELECTRIC CARS, SOLAR PANELS, WIND TURBINES,
ALGAE AND OTHER GREAT GREEN ENERGY! OH THAT'S RIGHT THEY DON'T!
MOST DON'T EXIST AND IF THEY DO DON'T WORK AND COST MORE AND
ALL THAT STIMULUS MONEY WENT TO BIG UNIONS AND SOYLANDRA AND
FRIENDS AND FAMILY! MAYBE THEY CAN BUY SOME CHEVY VOLTS AND RUN
ELECTRICITY FROM THOSE GREAT ELECTRIC CAR BATTERIES THAT RUN ON
MAGIC ENERGY! HE SHUT DOWN CHEAP ENERGY ALL ACROSS AMERICA!
HOW YOU LIKE IT NOW? LOUISIANA HAS LOST THOUSANDS OF JOBS! THANX OBAMA!

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