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Midwest Floods Help Drive Gas Prices Toward $4 a Gallon in Parts of the U.S.
Midwest Floods Help Drive Gas Prices Toward $4 a Gallon in Parts of the U.S.
Jan 17, 2024 3:44 PM

At a Glance

Midwest floods sharply reduced the ability to produce and transport ethanol.West Coast refineries also have experienced problems.A gallon of gas could rise to more than $4 a gallon in California, GasBuddy says.

U.S. gas prices are rising and could reach more than $4 a gallon in some states thanks in part to the recent flooding in the Midwest.

The this week, up more than 28 cents compared to a month ago, according to GasBuddy.

West Coast states are seeing the fastest increases, with California leading the pack. A gallon of gas there averages $3.81.

“California will soon be home to something not seen in nearly five years: a statewide average of ," Patrick DeHaan, head of petroleum analysis for GasBuddy, said in a statement.

The average gas price in California jumped 18 cents in the past week, according to GasBuddy. Five other Western states also saw double-digit increases: Washington at 15 cents; Oregon, 13 cents; Nevada, 12 cents; and Utah, 11 cents.

One factor in the rise in West Coast prices is a surge in unexpected refinery outages that has tightened the supply just as the refineries switch over to make a cleaner blend of gasoline for summer, DeHaan said.

A shortage of ethanol also is driving up gas prices in the West and the rest of the nation.

Ethanol, the biofuel added to gas to reduce emissions, is made with Midwest corn.

Widespread flooding last month knocked out nearly 13 percent of the country’s , Reuters reported. Plants in Nebraska, Iowa and South Dakota were forced to shut down or scale back production.

While some corn supplies were damaged, the flooding of rail lines used to move corn to the plants and finished ethanol to different parts of the country has had a bigger impact, according to Reuters. The flooding also prevented barges from leaving the huge ethanol terminal in Chicago.

According to GasBuddy, the West Coast will likely see prices continue to surge this week. Prices will rise in the rest of the country, too, just not as sharply.

"It really is going to be ugly this week in the West Coast, and any further issues could lead to more spikes, but for the rest of the country expect the rise to continue for a ninth straight week with little good news on the horizon,” DeHaan said.

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