Gas Prices To Continue Rise As Key Southeastern Pipeline Runs Intermittently

Gas Prices To Continue Rise As Key Southeastern Pipeline Runs Intermittently

Colonial had already closed down its other main line, which transports diesel and aviation fuels. Its shutdown could cause major fuels supply disruptions, as the volume is roughly one in every eight barrels of fuel consumed in the country.

Colonial Pipeline is shutting down a key line that supplies gasoline to the South due to refinery shutdowns and other impacts from Tropical Storm Harvey, meaning prices at the pump could rise even more in many states.

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And those numbers could change with Colonial Pipeline announcing that it would shut down part of the pipeline system that provides almost 40 percent of the South's gasoline. "For the same reasons, we expect that Line 1, which transports gasoline and is now operating at reduced rates, will suspend service tomorrow (Thursday)", according to the press statement. The Georgia average was 10 cents higher, at $2.39, up from $2.22 a week ago, according to AAA. The EPA said on Wednesday that it had expanded fuel waivers for gasoline throughout the U.S. Southeast in anticipation of supply shortages.

On Wednesday, Colonial said its two pipelines would be shut down because of the damage done by Hurricane Harvey and the massive flooding that followed in Houston and the surrounding area.

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But the fuel won't be flowing in the 5,500 miles of pipes that stretch from Houston to North Jersey because Harvey has shut down 23 percent of the nation's refinery capacity. "We will continue to serve you in the best manner we can, but rest assured, we will keep this communication line open and update you as much as possible until things are restored to normal operational status", according to the customer update.

By Saturday, he said gas prices in Toronto and southern Ontario will be up at least 17 or 18 cents total since the first indications last week that Harvey would cause major flooding in the Houston area. Motiva Enterprises holds exclusive rights to distribute Shell fuels to the majority of the southeast, said Natalie Gunnell, a spokeswoman for Shell's US products unit.

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That's led to a spike in USA gasoline futures, which reflect wholesale prices and eventually trickle down to consumers. "Once Colonial is able to ensure that its facilities are safe to operate and refiners in Lake Charles and points east have the ability to move product to Colonial, our system will resume operations", the company said in a statement about the closure. Josh Carrasco, a spokesman for AAA AutoClub Group, told NBC affiliate WXIA of Atlanta that Labor Day gasoline prices would likely be the highest since 2014. "And then we'll have more clarity down the road".

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