Gas prices in cities across the United States soared by as much as 40 cents a gallon from Tuesday to Wednesday, a surge blamed on disruptions by Hurricane Katrina in Gulf of Mexico oil production.
In many metropolitan areas, such as South Florida and Atlanta, prices were already approaching $3 a gallon, as they shot up throughout the early part of this week. Some stations in Chicago, areas of Boston and Atlanta reported prices had exceeded $3 a gallon. In the Atlanta area, a Chevron station in Stockbridge, Ga.'s price surged to $3.78 a gallon Wednesday afternoon and the Atlanta Business Chronicle reported many were charging $2.99 a gallon.
With gas prices spinning higher, regulators in some states are considering allowing some gas stations to charge by the 1/2 gallon. That's because those stations' old-style pumps can't begin with a "3." Many in the Denver area were expecting to see prices that high by the weekend.
The Orlando Business Journal reports that Floridians could see increases of up to 50 cents a gallon and at one station in Orlando, the cost per gallon is $2.99.
"It's very difficult to say because so much is unknown," says Greg Laskoski, managing director for AAA Auto Club South. "We don't know the extent of the damage, if the damage is short-term or long-term. We need more facts."
Ohio gas prices could go as high as $4 a gallon, the Dayton Business Journal reports. At least two Kettering, Ohio, stations were charging $3.09 a gallon for regular grade gas, the business journal reported.
In the Pacific Northwest, someone driving a BMW Z4 Roadster from Seattle to Portland, Oregon, could expect to spend $17.09 on gasoline, and taking a Ford F-150 on the same trip would cost $25.64. The Puget Sound Business Journal reported gas prices rose 2 cents overnight, to a record $2.75 a gallon.
Katrina knocked out about 95 percent of oil production in the Gulf -- a key supply point for the U.S. About a quarter of domestic oil comes from the region. The impact is being felt far from the Gulf.
The Triangle Business Journal in the capital region of North Carolina reported some stations hiked prices by a whopping 40 cents a gallon from Tuesday to Wednesday. Prices there ballooned from about $2.50 a gallon to nearly $3 a gallon. And supplies are running short. "We are almost out of gas," said the owner of The Food Mart #9 in Fuquay-Varina, N.C. "We don't know if we'll get gas this afternoon or next week. It's a bad situation."
The prospect of continued oil disruption sent crude oil prices briefly above $70 a barrel on the New York Mercantile exchange Wednesday. It also led analysts to predict average gas prices for regular unleaded would pass $3 a gallon in places by the Labor Day Weekend, traditionally the last big traveling weekend of the summer.
Nationally, prices were $2.619 a gallon Wednesday morning, up from $2.604 Tuesday and $2.284 a month ago, according to AAA. September unleaded gasoline futures were trading at $2.68 a gallon, a record, Wednesday morning.
But prices vary widely, by city and sometimes even by block. In the Tampa Bay area, prices can differ by as much as 30 cents a gallon at stations blocks apart for the same grade and sometimes the same brand of gas, the Tampa Bay Business Journal reports.
Californians, already paying some of the highest prices in the nation, will have to dig a little deeper, thanks to the Katrina cost. Prices in Los Angeles increased 3 cents to $2.82 a gallon Wednesday from $2.79 Tuesday. The San Francisco Bay area saw an even bigger jump of 5 cents to $2.90 a gallon from $2.85 Tuesday. And in Sacramento, the price was continuing to rise, hitting $2.95 a gallon at some stations, the Sacramento Business Journal reported.
In Nashville, Tenn., prices were comparable to the California figures. The Nashville Business Journal reported the average price of a gallon of gas in Nashville listed at $2.70, on Wednesday, up 11 cents from the average price Tuesday. In Kentucky, which was under a state of emergency Wednesday owing to remnants of the hurricane moving north, stations were reporting shortages around the state, Business First of Louisville reported.
The Philadelphia region is feeling a storm surge of price rises, the Philadelphia Business Journals reports. "This storm has hit the Achilles heel of the oil industry -- the Gulf Coast region, which is a critical source of oil in this country," said Catherine L. Rossi, manager of public and government affairs at AAA Mid-Atlantic. "Major pipelines have lost power and as a result, the entire oil infrastructure and its supply chain are deeply affected by this storm." She said she expects prices to rise further.
On Tuesday, regular unleaded gas prices in the five-county Philadelphia region, Delaware and New Jersey reached record levels at $2.67 per gallon, $2.61 per gallon and $2.54 per gallon, respectively. The Philadelphia region averaged $2.41 per gallon a month ago and $1.92 per gallon a year ago.
Pittsburgh is seeing similar price hikes. Prices rose 8 cents in two days in some areas. The price for regular unleaded was $2.61 a gallon, the Pittsburgh Business Times reported.
If the price was rising at the pump, it's also likely to rise at the airline ticket gate, the Phoenix Business Journal reported. Airlines have seen jet fuel costs jump by as much as 22 percent over the past two days. For motorists in the desert state, the average price at the pump was up 2 cents from Tuesday, to $2.67 a gallon.
The Bush administration decided to release oil from the nation's petroleum reserve in an attempt to stabilize prices. The announcement was made Wednesday. But prices at the pump still soared.
The prospect of rising prices and tightening supplies has some state politicians nervous. Missouri Gov. Matt Blunt directed Attorney General Jay Nixon to look into gasoline suppliers and stations over possible price gouging, the Kansas City Business Journal reported. "We have seen price gouging in our state before, and I will not permit businesses to reap unjustified profits by using a natural disaster as an excuse to gouge customers," Blunt said in a written release.
Georgia on Tuesday waived some environmental regulations to loosen potential supply problems and price escalation.
American City Business Journals, Inc.