-- Gasoline prices jumped nationwide Sunday and there were warnings of shortages as companies assessed damage to oil rigs and refineries from Hurricane Ike. The government is releasing oil from its emergency stockpiles to refineries experiencing shortages.
Drivers could see isolated shortages in coming days, and gasoline prices are likely headed into the $4 range in many parts of the country, Oil Price Information Service analyst Tom Kloza says.
"There's no question that supply is going to be an issue," Kloza says, while stressing that shortages won't be widespread. "People shouldn't panic."
"We are looking at another week or eight or nine days before refineries are up and going, so refined gasoline is going to be in a shortage situation because of the power outages and flooding," U.S. Sen. Kay Bailey Hutchison of Texas said on CBS' "Face the Nation."
Chevron said it is "concerned about severe gasoline supply disruptions in the wake of Hurricane Ike. It may not be possible for us — and other manufacturers — to maintain normal supplies in the coming days."
The U.S. average price of a gallon of regular rose more than six cents overnight to $3.795 Sunday, according to AAA and OPIS. Prices have risen more than 13 cents since Thursday and are $1 higher than a year ago.
Although prices at the pump are headed higher, the increases will likely be capped by energy companies' desire to not appear to be taking advantage of the situation, even if they are paying far more for supplies, Kloza says.
Energy Department spokeswoman Healy Baumgardner said Sunday that the government is "doing everything possible to minimize impacts to American families," including releasing emergency oil stockpiles, allowing leniency on clean-gasoline formulations and monitoring allegations of price gouging.
Governors in a number of states took action to prevent gouging. North Caroline Gov. Mike Easley declared a state of "abnormal market disruption." He ordered the Attorney General to enforce the state's price gouging statute, prohibiting the charging of prices that are "unreasonably excessive under the circumstances."
Shell Oil Saturday evening encouraged consumers who believed they were seeing price gouging to contact their state attorney general or the company's customer service line.
"Allegations are taken seriously and we will investigate prices that are out-of-line with the market," the company said in a statement.
The Energy Department on Sunday said it was releasing more than 300,000 barrels of oil from the Strategic Petroleum Reserve to two refineries experiencing shortages. The department said it was releasing 200,000 barrels to ConocoPhillips Company's Wood River refinery in Illinois and 109,000 barrels to Placid Oil's Port Allen refinery in Louisiana.
It was the third time in less than a week that oil was released from the emergency stockpile. Supply was already disrupted by Hurricane Gustav before Ike hit Saturday morning.
The government said Saturday that almost all oil and natural gas production in the Gulf of Mexico was halted and at least a dozen refineries were shut down. The oil companies were expected to be assessing the damage on Sunday.
More than one-quarter of the offshore crude oil produced in the USA comes from the Gulf of Mexico; 42% of the nation's refinery capacity is located along the Gulf Coast, according to the Energy Department.
The Minerals Management Service said late Saturday that two drilling rigs were adrift in the central Gulf of Mexico. The rigs did not pose a risk to oil and natural gas infrastructure in the area, the agency said.