Gas prices in Chicago highest in the nation and set to jump
BY FRANCINE KNOWLES Business Reporter/fknowles@suntimes.com August 28, 2012 11:04AM
Gasoline prices are displayed at a gasoline station earlier this month in Chicago, which now has the highest gas prices in the nation as of Aug. 28, 2012. File photo | AP Photo
Updated: September 30, 2012 6:13AM
Average gasoline prices in Chicago are the highest in the nation and even exceed the cost in Hawaii, according to AAA Chicago. And while they’ve fallen in the past week, they’re expected to reverse course amid Hurricane Isaac which is threatening the Gulf Coast as the Labor Day holiday approaches.
“Short-term you should see prices rise maybe 10 cents a gallon very easily,” said Phil Flynn, oil industry analyst with the PRICE Futures Group.
The average price of unleaded regular gasoline in Chicago was $4.37 a gallon Tuesday, 61 cents a gallon above the national average and nearly 13 cents above the Honolulu area.
“That’s very, very unusual,” AAA spokeswoman Beth Mosher, said of Chicago prices exceeding those in Hawaii. Blame it on multiple factors, she said.
“We had high prices hit a few weeks ago with refinery issues close to home in the Lemont area and Whiting, Ind., a pipeline that burst in Wisconsin,” which sent prices up, she said.
After a brief fire, the BP refinery in Whiting temporarily shut down a coker unit last month that produces raw coke used in fuel.
And BP’s temporary halt of higher grade gas sales in the Chicago area last week following the recall of more than 2 million gallons of tainted gas in the area also drove up prices here, according to Flynn. The average price of premium gasoline in the Chicago area climbed to $4.53 a gallon Tuesday from $4.51 a week ago.
The average price of unleaded regular in Chicago was down 2 cents a gallon Tuesday from a week earlier. In the Chicago area, the price was down six cents at $4.16.
“It’s one thing after another,” said Flynn, who noted Chicago has seen high volatility in wholesale prices. “Now you have this storm down in the Gulf of Mexico. Things could get worse if Isaac does some real damage.”
And Monday, he said there was word that a pipeline used to transport gasoline from to East Chicago from Wisconsion had been temporarily shut down. He noted wholesale cash prices rose 30 cents a gallon Monday and fell 17 cents as of midday Tuesday.
“That has to be passed around,” he said. “I think you’re going to see wide discrepancies of prices station to station because the people buying the gas for the stations, the wholesalers, {their} prices have been all over the board.”
The message to consumers is shop around, he said.
On a brighter note, some price relief shouldn’t be too far off. After Labor Day, the refineries will begin making the switch from the more expensive summer fuel blends to cheaper fuel, he said.
