Hurricane Irene Threatens East Coast Refineries, Oil Price Hike

By on Aug 28, 2011 in Business Comments

Hurricane Irene has raised fears of an oil price hike as it threatens to hit the oil refineries in the East Coast, according to reports by several international news sites on Saturday, August 27, 2011.

The path of Hurricane Irene indicates that it will hit the refineries in Philadelphia, New Jersey and Delaware. The East Coast oil output is about 10% of the US refining capacity or over a million barrels per day based on the Oil Price Information Service.

Threats by Hurricane Irene has already raised the trading of Gasoline futures in New York by 10 cents a gallon last week. Experts believe that there will be disruption in output from the East Coast refineries and barge routes or pipelines serving the eastern seaboard.

Analysts expects pump prices of oil to increase by 15 to 20 cents. Stephen Schork, publisher of the industry newsletter the Schork Report, said that “You’ll probably see a temporary pop.” He explained that everything “depends on how bad the disruptions are.”

As a precautionary measure by the refineries, large ships have been sent to the sea to avoid potential damage of crashing them into the docks.

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