Will the spike is gas prices affect your Labor Day weekend plans?

Published: Thursday, August 30, 2012, 5:29 AM

Gas Price Increase in New Jersey for Labor Day

The price of a gallon of gas is going up because of Hurricane Isaac, experts say. Drivers are being hit with the biggest one-day jump in gasoline prices in 18 months, just in time for the last hurrah of summer when the roads are typically packed. Blame Hurricane Isaac, experts say. The storm is battering the nation's oil and gas hub along the Gulf Coast, as well as drivers everywhere else.

The national average price of a gallon of gas jumped almost five cents Wednesday to $3.80, the highest ever for this date. Prices are expected to continue to climb through Labor Day weekend, the end of the summer driving season. "The national average will keep ticking higher, and it's going to be noticeable," Patrick DeHaan, senior petroleum analyst at Gasbuddy.com, told the Associated Press. The storm shut down several refineries along the Gulf Coast and others are operating at reduced rates. In all, about 1.3 million barrels per day of refining capacity is affected. So, it's no surprise that drivers in Louisiana, Alabama, Mississippi and Florida saw gas prices rise by a dime or more in the past week. But some states in the Midwest are suffering even more dramatic spikes. Ohio prices jumped 14 cents, Indiana prices soared 13 cents and Illinois prices jumped 10 cents on Wednesday alone according to the Oil Price Information Service.

Analysts say the prices are expected to drop after Labor Day. As Isaac fades away, the summer driving season ends, and refiners switch to cheaper winter blends of gasoline, stations owners should start dropping prices. "There is some very good relief in sight," DeHaan says. When Katrina hit in 2005, the national average for gas spiked 40 cents in six days and topped $3 per gallon for the first time. Isaac likely won't have the same result, though its full impact on the refineries is yet to be determined. The refineries are not expected to suffer long term damage. But refiners decided to shut down or run at reduced rates to protect their operations. Wednesday's jump of a nickel was the 10th biggest one-day jump on record, according to OPIS, and the biggest since the average price rose 6 cents on February 15, 2011 when turmoil in Libya was rising.

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Thursday, August 30, 2012