Just a few hours after Hurricane Ike hit the Texas and Louisiana coasts, Emporia was already feeling the pain. Gasoline prices jumped at stations all over town. The increases ranged from 17 cents a gallon to more than 35 cents a gallon.
The increases were not unexpected. Before the hurricane hit, oil platforms and refineries in and along the Gulf of Mexico were being shut down and the wholesale price of gasoline rose above $4 a gallon. About 20 percent of the nation’s gasoline is produced in the region and anything that shuts down production send the whole nation on an energy-price thrill ride.
When will the prices come down again? That depends on how badly the platforms and refineries were damaged, how soon power can be restored in the region and how soon workers can return to their homes. Restoring energy production will be a top priority, but Ike was a huge storm and caused tremendous damage over a wide area. Don’t expect production to return to normal for weeks.
The hurricane has raised again the question of just what sort of energy policy the nation has. Does it make sense for so much of the refining capacity to be concentrated in such a relatively small area? Granted, the refineries tend to be built close to the supply of oil, but wouldn’t it save money and stabilize the market to move them farther inland and away from the fierce weather of the coasts? That way, they could be ready to start production after a storm as soon as the offshore platforms and pipelines were back in operation.
Hurricanes do enough damage as it is. Perhaps it is time to think about moving essential industries out of harm’s way.