Gas Prices To Continue Rise As Key Southeastern Pipeline Runs Intermittently


Colonial Pipeline said it would shut its main diesel, jet fuel and gasoline lines because of outages at its supply points. The Explorer Pipeline, which has a capacity of 660,000 barrels a day, said on Wednesday it had shut its main fuel line from Houston to Tulsa, Oklahoma, as supplies dwindled.

A big blow to the USA fuel supply - A major pipeline that carries tens of millions of gallons of fuel between Houston and North Jersey has shut down because of Harvey.

Colonial Pipeline Co. has shut down main lines that provide a key fuel link between Texas and the USA east coast market, which influences prices in eastern Canada.

PREVIOUS STORY: The main pipeline carrying fuel from Texas to the East Coast is temporarily shutting down because of refinery outages related to Hurricane Harvey, the company that runs the pipeline said Wednesday night, dealing a potentially major blow to the already storm-ravaged USA fuel system.

The pipeline provides almost 40 percent of the South's gasoline. The price spike is more dramatic in some states such as Georgia, where the average cost per gallon of regular gas has climbed from $2.22 a week ago to $2.39 now.

That means fuel prices are expected to rise more than they already have, and will continue rising the longer the refineries and pipelines are out of commission, the American Automobile Association and the EPA predicted.

Power outages during Hurricanes Katrina and Rita in 2005 forced the shutdown of parts of the Colonial Pipeline for several days. The company said there was no timeline when the pipelines would be restarted.

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But the fuel won't be flowing in the 5,500 miles of pipes that stretch from Houston to North Jersey because Harvey has shut down 23 percent of the nation's refinery capacity.

The biggest USA fuel system which transports fuel between Houston and the East Coast is shutting down due to the wrath of Hurricane Harvey.

Kinder Morgan Inc's (KMI.N) 700,000-bpd Plantation Pipeline system, which originates in Louisiana and ends in the Washington, D.C., area, remained fully operational, the company's spokeswoman, Melissa Ruiz, said in an email. Of the 26 refineries connected to the Colonial system, 13 are located between Houston and Lake Charles, the company said. The national average for gasoline prices Thursday was $2.45 per gallon.

Colonial Pipeline is based in the Atlanta suburb of Alpharetta.

"If people aren't freaking out, the gasoline supply in SC could last until we start to see the normal flow of gasoline again", DeHaan said.

"Until they know everything is okay, they don't want everybody to rush and take all of it they've got, and deplete their supply", he said.