You know that 20-cent-per-litre price hike you got ambushed with Wednesday morning? Brace yourself for another hike Thursday morning. Maybe even Friday morning.
This Globe and Mail story explains why:
Oil market faces disaster
By BARRIE MCKENNA AND PATRICK BRETHOUR
Wednesday, August 31, 2005 Updated at 9:16 PM EDT
From Thursday's Globe and MailHurricane Katrina has become the disaster scenario that the oil market has fretted about for months: a sudden, massive disruption to an already overstretched refining industry.
The United States announced Wednesday that it would relax fuel pollution standards and release strategic oil reserves as it scrambles to head off shortages after Katrina hobbled the country's capacity to produce, refine and import crude.
The hurricane has knocked out more than 10 per cent of U.S. refining capacity and virtually all oil and gas produced in the Gulf of Mexico -- perhaps for months.
At least 20 oil rigs and platforms are missing in the Gulf of Mexico and a ruptured gas pipeline is on fire, according to the U.S. Coast Guard. The fate of many other rigs and platforms remains uncertain.
Like the hurricane's wind and rain, the impact has quickly rippled through the North American oil and gas industry, sending wholesale gasoline prices soaring, exaggerating refining margins and taxing refineries already running flat-out. Refiners and wholesalers as far away as Illinois and New York have begun rationing shipments to gasoline retailers.
Katrina's effects on the industry are likely to be “significant and protracted,” American Petroleum Institute president Red Cavaney warned grimly.
Here was CTV.ca's story on the price jump: Katrina blamed for soaring gas prices in Canada (lots of video attached).