Average gas prices in Minnesota have jumped by more than 30 cents in a week, according to AAA data.
Analysts with GasBuddy predicted last week that average prices in several Corn Belt states could increase by roughly 35-55 cents per gallon because of a refinery outage.
Unconfirmed details are that Flint Hills has started maint at its Pine Bend, MN refinery, a significant hit with capacity of 320kbpd, unexpected downtime for PSX in Oklahoma as well, and limited ability for gasoline to come from the East as BP's Whiting refinery is having issues. https://t.co/kpurtoxRYw
— Patrick De Haan ⛽️📊 (@GasBuddyGuy) September 7, 2023
“The details on the outage generally lag the response we see in wholesale gasoline prices, due to the nature of these situations. A refinery that goes down has contractual obligations to supply certain volumes of gasoline to stations. If an unexpected outage happens, the refinery that goes down suddenly may not have enough supply to meet its obligations and has to find another refinery to buy from,” Patrick De Haan, head of petroleum analysis at GasBuddy, said in a Sept. 7 statement.
“This can push prices up considerably, as a refinery could be a very large buyer. Adding in that we’re just a week away from the switch to cheaper winter gasoline, we have a very large, but temporary squeeze in the market,” he added.
These increases have driven the national average higher after falling for two straight weeks.
“The national average hit some road bumps over the last week after starting to decline early in the week. The second half saw the national average rise as gas prices in the Corn Belt started spiking, pulling the average price in the U.S. along with it,” De Haan said Monday.
“In addition, the West Coast saw more refinery snags, pushing gas prices higher, and so areas of the West Coast got punched along with the Corn Belt states. Over 10 states saw prices rise by over 10 cents per gallon compared to last week, while some like Iowa and Minnesota have seen average prices spike by over 30 cents per gallon,” he added.
De Haan said prices should start to level off or even decline by the middle of the week.
“And with most of the nation switching back to cheaper winter gasoline on Saturday, we should see more price decreases for most of the nation in the weeks ahead, barring further refinery disruptions and hurricane season. Fall tends to bring falling gas prices, and I’m hoping this year won’t be any different,” he explained.
According to De Haan, 26 markets, including six in Minnesota, have seen prices increase by more than 30 cents per gallon over the last week.
— Patrick De Haan ⛽️📊 (@GasBuddyGuy) September 11, 2023