All eyes this morning are on Tropical Storm Debby, currently perched off the shore of Tampa and moving fast inland.Because the Gulf of Mexicop is home to many oil shipping hubs and oil refineries, you’d think oil and gas prices would be jumping at the news.
Oil prices are down 0.8 per cent per cent.
That’s because the storm is nowhere near intense enough to substantially threaten supplies.
Furthermore, the storm seems just intense enough that it may hinder demand as drivers stay off of the streets, according to GasBuddy.com’s Gregg Laskoski.
Storms that fall in this in-between category — big enough to get on the radar, but not yet hurricane status — produce “demand destruction,” Laskoski told Business Insider.
Plus, he said, the U.S. is in the midst of an oil glut.
“Refineries nationwide have been operating at 92 per cent,” he said. “It doesn’t get that much better from consumer perspective.”
Finally, Debby picked the wrong direction to spook prices. Unless a storm is heading for the Gulf of Mexico — where the majority of refineries are — prices will go nowhere.
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