Gasoline prices have risen for eight straight weeks, according to new data published by Gas Buddy on Monday. And a major refinery explosion near New Orleans could threaten to send gasoline prices even higher.
U.S. national gasoline prices were on the rise early on Monday, climbing 3.2 cents from a week ago to reach $3.52 per gallon as tensions between Ukraine and Russia flared.
"With tensions still very high that Russia may invade Ukraine, gasoline prices kept moving higher, tugged by the rising price of oil as the market concentrates on possible outcomes from the situation that could affect global oil production amidst recovering demand," said Patrick De Haan, head of petroleum analysis for GasBuddy.
"However, with nuclear talks between Iran and global powers ongoing in Vienna, the possibility exists that a new deal could bring Iran's crude oil supply back to legitimate markets, helping to ease a slight portion of supply concerns."
De Haan added that the United States is a few weeks away from the traditional start of the spring surge in gasoline prices, brought on by the change to summer gasoline, seasonal maintenance at refineries and rising demand, and warned that the weeks ahead could get ugly with rising prices.
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Indeed, a refinery explosion near New Orleans on Monday morning is threatening to hasten that rise in gasoline prices, as gasoline supplies could find themselves even more constrained.
The explosion shook homes and could be heard for miles.
Marathon Petroleum Corp's oil refinery in Garyville, Louisiana, is one of the nation's largest refineries and a major supplier of gasoline and diesel. It has a capacity of 578,000 barrels per day.
10% of that region's refining capacity is already idle for repairs, according to Bloomberg.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group. More