Tropical Storm Isaac Expected to Cause Steep Increase in Local Gas Prices

AAA officials have said that Tropical Storm Isaac — soon expected to become Hurricane Isaac — may cause gas prices to rise 25 cents a gallon.

Metro Detroit gas prices are expected to rise about 25 cents a gallon by this time next week.

Officials from AAA have said that Tropical Storm Issac, which is currently ripping across the Gulf of Mexico, will shut down offshore oil rigs.

The National Hurricane Center has predicted that the tropical storm will become a hurricane on Tuesday with 74 to 95 mph winds. It is expected to hit from an area southwest of New Orleans to the edge of Florida's panhandle.

The cheapest unleaded gas available in Canton as of 5 p.m. Monday is Meijer, 45001 Ford Road; Speedway, 45350 Ford Road; Speedway, 5596 N. Lilley and Knight 31, 41350 Ford Road, all registering at $3.84 per gallon.

In Plymouth, the cheapest gas prices are at Plymouth One Stop, 129 W. Ann Arbor Trail; Marathon, 402 N. Mill St. and Speedway, 1066 N. Mill St., where fuel is $3.88 per gallon.

Tropical Storm Isaac targeted a broad swath of the Gulf Coast on Monday, bearing down just ahead of the seventh anniversary of Hurricane Katrina.

The potential for a landfall as a Category 1 hurricane as soon as Tuesday prompted evacuations along a wide area of the Gulf Coast and sent people out to stock up on staples.

Bruce Koldys August 28, 2012 at 12:58 PM
If the oil/gas industry operated purely on supply/demand principal there would not be an increase in the price of gasoline due to a tropical storm. There is spare capacity (although not terribly much). There is a concept in pricing of gasoline called "demand destruction". This in theory occurs when the price of gasoline gets high enough to reduce demand. Pure supply and demand. However demand destruction only begins to occur at 4.50 per gallon and perhaps even at 5.00. A .25 cent increase in the cost of gasoline is not a reply to supply and demand and will not result in demand destruction for gasoline. It is price manipulation in the exact same manner that Enron manipulated energy prices in California in order to exact more profits. Why is the price of gasoline an average of 15 cents or more per gallon LESS expensive as you cross Middlebelt road going east? Do they have their own oil wells? Gasoline prices have become hostage to speculation and manipulation and have left supply and demand behind. I have even seen on days a 40 cent per gallon difference in the cost of gasoline from Dearborn to Canton. Also is it a coincidence that gasoline prices seem to be higher in communities that have a higher per capita income??
John McKay August 28, 2012 at 02:36 PM
I noticed that too, Bruce, while enjoying a weekend drive down Ford Road along Dearborn, Garden City and Metro Detroit. Noticed big changes in gas prices as I went further East. Went to the cheapest safe-looking gas station I could find and came back to see it at least 10 cents more in Plymouth and Canton. Same with where I'm originally from - Fenton. Gas prices there are always more than in Flint. I think there's a perceived "danger" of going into one of the Flint stations (and depends on where you're at, there might be), so it's hard to tell if they're cutting their profits to appeal to frugal customers or if the perceived nicer towns and stations are just boosting their own prices simply because they can.


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