Gas Prices Rise on Flooding Concerns

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Gas Prices Rise on Flooding Concerns

NEW YORK -- Midwestern refineries suffering from floods and higher oil costs reversed a previously predicted decline in gas prices, and instead, pushed the nation’s average price to $3.05 per gallon, 6 cents higher than the average price of three weeks ago, reported CNN, citing the latest Lundberg survey of 7,000 gas stations in the U.S.

As of June 27, the average price for a gallon of gas was $2.99, the first time in two months that the price was below the $3 mark, the report stated. That decline was expected to continue, however, flooding in the Midwest that closed two refineries did not allow the decline to continue.
Survey publisher Trilby Lundberg told CNN the rise was the result of massive flooding, where heavy rains shut down two major refineries in Whiting, Ind. and Coffeyville, Kan.

"U.S. refining operations are still limping back to maximum use of capacity," Lundberg said. "Some repair and maintenance projects are still being completed."

Those problems have intensified capacity issues, she added. In addition, the price for U.S. crude oil rose $4.79 per barrel, ending last week at $73.93 per barrel, according to Lundberg.

However, the national 6-cent rise in average prices is small, and aided by the wide range of prices around the nation, she told CNN.

"It's like having one foot in ice, the other in boiling water," she said. "On average they seem similar."

Lundberg predicted the nation will see high gas prices for at least another month, while refineries come back online and summer demand continues.

Of the cities surveyed by Lundberg, Tucson, Ariz., is home to the lowest national average at $2.80 per gallon. Chicago remained at the top of the list with $3.46 per gallon. The largest increase was seen in Minneapolis, where gas jumped 42 cents, from $2.89 on June 22 to $3.31 on Friday.