Oil industry analysts are rejecting claims by Sen. Chuck Schumer (D-N.Y.) that 'big oil' is 'gouging' customers by keeping gas prices artificially high following Hurricane Harvey, News Radio 1200 WOAI reports.
Patrick DeHaan, an analyst with Gasbuddy.com says, if anything, the opposite is true, that 'big oil' absorbed most of Harvey's producing losses.
"The reality of it is that retail prices actually did not go up as fast as wholesale prices," DeHaan said. "It is kind of the way the market works, when you start messing around with supply and demand."
DeHaan says, as with major hurricanes in past years, the wide swath cut by Harvey across the Gulf, from the Corpus Christi area to southwestern Louisiana east of Lake Charles, took out a huge chunk of the nation's refining and oil production capacity.
"During Harvey, we missed out on millions of barrels of lost gasoline production," he said. "That is lost time, and prices will come down slowly as production begins to increase."
The Energy Department says several major Gulf Coast refineries are still operating on limited production schedules due either to damage caused by the storm to the refinery itself, or to pipelines that carry the refined products. In some cases, the U.S. Coast Guard has to certify that terminals are safe for loading onto lightering ships before the refineries can be restarted.
DeHaan says prices are coming down. He says the average price of gasoline in San Antonio today, $2.47, is a nickel a gallon less than one week ago, when gasoline production was limited far more than it is today.
But that is compared with $2.05 one month ago, before Harvey hit.He says we are gradually returning to that level.
"So long as there are no more hurricanes, we'll probably get back down there in a few weeks, maybe a month or two at worst," he said.