Six oil refineries located along the east coast cut production or closed prior to Hurricane Sandy’s arrival. Usually with storms of this caliber gas prices spike but that isn’t happening this time around. Triple-A Nebraska’s Rose White says even with lower regional production, demand has also dropped significantly.
Typically, 8.5-million barrels of oil is used each day but demand is expected to drop one-million barrels each day for the next several days. The East Coast is a huge consumer of oil and with thousands of flights canceled and transportation at a standstill, less oil and gasoline is needed. The drop in demand has the potential to pressure pump prices lower.
AAA says assuming a smooth restart to production and distribution in the areas impacted by Hurricane Sandy gas prices across the country will continue to drop leading up to Election Day and will move even lower approaching the end of the year.