Gas prices are spiking after the biggest US refinery shuts down

Gasoline prices are surging again on Thursday amid refinery closures in Texas caused by Hurricane Harvey.

Gas futures for September delivery are up 12% to $2.11 per gallon at 10:40 a.m. ET. In their eighth straight day of gains, futures are on their longest rising streak in four years, according to Bloomberg. Futures for October delivery also rallied.

Prices at the pump are also higher. The AAA’s average national gas price at 3:43 a.m. ET on Thursday was $2.449 per gallon, up from an average price of $2.348 per gallon last week.

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October gasoline futures
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Investing.com

Motiva’s refinery in Port Arthur, which is the largest in the US, shut down Wednesday as flood waters rose. And on Thursday, Colonial Pipeline, which owns the largest pipeline for gas distribution in the US, had planned to shut down its gasoline line because Gulf Coast refiners were unable to process crude oil, Bloomberg reported. “Deliveries will be intermittent and dependent on terminal and refinery supply,” the company said in an update.

To help with the gasoline shortage, the Energy Department said Thursday it was releasing 500,000 barrels of oil from its Strategic Petroleum Reserve that holds supplies for emergencies. The agency said it loaned the barrels of both sweet and sour crude to a Phillips 66 refinery in Lake Charles, Louisiana, which has not been affected by Hurricane Harvey.

The Fort Worth Star-Telegram reported that some gas stations in the area might run out of supplies during the Labor Day weekend. Gas stations on the East Coast could also experience shortages, Bloomberg reported, and this could send gas prices even higher.