Just a few weeks ago, several states had gas prices at or below $2. That is no longer the case as prices in the states with the least expensive average price for a gallon of regular have surged to above $2.30, an increase of at least 15%. The increase may be short lived
As is usually the situation, gas prices are the least expensive in states near the refineries on the Gulf of Mexico. Hurricane Harvey has pushed those prices up, but they are still below almost any other states. The lowest price for a gallon of regular nationwide is $2.33 in Oklahoma. The price in Lousiana is $2.34. In Arkansas, it is $2.38. In Alabama, $2.47 and in Texas, the price is $2.48. At the highest end of these Gulf state prices, they have become as expensive as states which traditionally do not have the least expensive gas prices. Far from the Gulf, the price in Kansas is $2.48, which matches the price in Minnesota.
If the increase in Gulf state prices continues to rise, they will become higher than they are in much of the U.S. It would only take an increase of $.10 to $.15 to happen.
Gulf states still have one advantage over most other states when it comes to low gas prices. Taxes and levies on a gallon of gas in many of these states are among the lowest in America. Against an average state tax nationwide of $.50, the figure is $.345 in Oklahoma, $.372 in Mississippi, $.384 in Texas and Lousiana, and $.413 in Alabama.
Will gas prices in the Gulf states continue to rise? Much of answer is based on how quickly major refineries open. According to Reuters,
A number of key Texas refineries worked to reopen or resume normal operations on Saturday, a week after Hurricane Harvey knocked out nearly one quarter of the U.S. refining capacity and sent gasoline prices to two-year highs.
While much of the region’s refining infrastructure still remained offline from Harvey, which made landfall as a Category 4 hurricane last week and drenched Texas as a tropical storm, the restarts were a first step in alleviating concerns about U.S. fuel supplies.
Prices in the Gulf states could drop back to where they were two months ago, in only a matter of weeks.