Gas prices have surged about $0.20 since July 4, and currently stand at a national average of $3.67 a gallon.
This has been a headache to the American driver, and economists are worried about what it could do to spending.
Unfortunately, it could be a little while before we see some relief at the pump.
In a new note today, fuel markets guru Stephen Schork warns not to expect any relief until September.
To this effect, on Friday Irving reportedly shut down units at this refinery. This news compounded the recent unplanned outages at Phillips 66 Bayway, NJ facility and Philadelphia Energy Solutions South Girard refinery.
Schork also believes the rising cost to refiners of the renewable fuel standard — a topic we also discussed — has filtered into prices:
Add to this the 1,800% spike in RINs and the attendant incentive to export mogas rather than pay the EPA’s vigorish, and all of a sudden, gasoline supplies around the NYMEX NYH terminal complex look challenged.
Result: more pain —
Of course this is going to translate (should these prices prevail) into higher gasoline prices for consumers. For example, over the previous three summers a $0.01 per gallon increase on the NYMEX has translated one month later to a $0.009 gallon increase in pump prices. NYMEX RBOB for August delivery has rallied by around 46 cents this month.
Given that AAA gasoline was at $3.474 over the 04th of July holiday, pump prices could be pushing up against $3.900 by the labour Day holiday.
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