Back-to-Back Storms Take Toll on Florida Gas Prices
WASHINGTON, D.C. — Back-to-back hurricanes Harvey and Irma have had an impact on Florida’s gas prices.
There are no petroleum refineries in Florida or major pipelines connecting Florida to supply centers along the U.S. Gulf Coast or from neighboring states, so the Sunshine State is almost entirely supplied by marine movements of petroleum products from domestic and international sources, according to the U.S. Energy Information Agency (EIA).
Because Florida is largely dependent on marine movements of gasoline from the U.S. Gulf Coast, any threat of or actual disruption to supply sources and shipping routes, such as Hurricane Harvey, can affect gasoline markets. Between Aug. 21 and Aug. 28, when Hurricane Harvey made landfall in Texas, retail gasoline prices in Florida and Miami increased 10 cents per gallon and 5 cents per gallon, respectively, based on EIA's weekly survey of gasoline prices.
In the 10 weeks prior to Hurricane Harvey's landfall, Florida's average gasoline prices were about 15 cents per gallon lower than the U.S. average. In the weeks since Harvey's landfall, the state's average gasoline prices rose faster than the U.S. average and as of Sept. 11 are slightly higher than the U.S. average.
Ports closed as Hurricane Irma approached, creating shipping traffic and stopping the flow of petroleum products into Florida. Evacuations of large population centers preceding the hurricane increased passenger car travel and pre-storm fuel purchases. Because several supply options were partially disrupted, this demand increase resulted in a large draw on petroleum product inventories at product distribution terminals within the state, according to EIA.
Increased demand and falling inventories caused Florida and Miami gasoline prices to rise by 40 centers per gallon and 39 cents per gallon, and $2.70 per gallon and $2.87 per gallon, respectively, between Aug. 28 and Sept. 4.
By Sept. 11, state-wide average retail gasoline prices in Florida decreased 1 cent per gallon from the prior week to $2.69 per gallon. In the wake of Hurricane Irma, EIA was unable to collect sufficient survey responses to publish retail gasoline prices for Miami for Sept. 11.
Additional gasoline is expected to arrive in Florida through several large coastal ports. From there, fuel is transported to nearby markets by truck and by short-distance pipeline, which can lead to supply constraints at gas stations during periods of high demand.
Terminals within the Port of Tampa supply much of the state's west coast, as well as parts of central Florida such as Orlando. Other portions of central Florida are supplied by shipments from Port Canaveral on the Atlantic Coast. Northeastern Florida is supplied by terminals in the Port of Jacksonville.
As of Sept. 13 the ports near Tampa, Jacksonville and the Everglades have reopened, with others to follow. Soon after, shipments of petroleum products are expected to arrive from refineries in the Gulf Coast and Europe, as well as from product storage terminals in the Caribbean, Canada, and elsewhere in the U.S., EIA reported.