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Retail US gasoline prices surged to two-year highs on Friday and global shipping routes were scrambled, even as some US oil refineries began restarting in the wake of Hurricane Harvey, according to Reuters.
Major fuel pipelines feeding the US Northeast and Midwest were shut or severely curtailed, prompting shortages and dramatic spikes in wholesale cash prices that pushed the national retail average to $2.519 a gallon, the highest since August 2015.
Harvey raked across the Texas Gulf coast, roiling global fuel markets as it knocked out about 4.4 million barrels of daily refining capacity, slightly more than Japan uses.
Tankers carrying millions of barrels of fuel have been rerouted to the Americas to avert shortages.
European refining margins hit a two-year high amid the surge in exports, which included a rare cargo of jet fuel.
After record rains and flooding, the storm’s effects will be felt for weeks, possibly months. Only some restarts have begun so far.
Governor Greg Abbott said on Friday Texas will not run out of gasoline despite refinery issues.
“There’s plenty of gasoline in the state of Texas,” Abbott said at a news conference. “Don’t worry. We will not run out.” The US Energy Secretary approved an additional release of crude oil from the Strategic Petroleum Reserve, adding 3.5 million barrels to the one million barrels approved as of Thursday.
The Explorer Pipeline, which hauls fuel from the US Gulf Coast to the Midwest, targeted a restart of its main lines on Sunday and Monday.