According to AAA, the nation's average gas price decreased by two cents as of Sunday, the cheapest price since early July 2021, but was back up a penny to $3.15 Monday morning following Hurricane Ida.
The storm has left more than one million people in Louisiana and Mississippi without power and likely taken about 13% of U.S. refining capacity offline. There were nine oil refineries in Ida's path; at least four were believed to have shut down operations ahead of the storm.
"Until the power is restored, it's too early to know the full impact of any damage Ida caused on the oil and gas industry, but motorists regionally can expect price fluctuations leading into Labor Day weekend," said Jeanette McGee, AAA spokesperson. "Typically, a category 4 storm could mean three plus weeks before refineries are back to normal operations, while offshore production is more likely to resume this week."
As a precautionary measure, the Colonial Pipeline announced on Sunday that they shut down two main lines that run from Houston, TX, to Greensboro, NC.
The company added that following an infrastructure inspection after the storm, the pipeline would be back to full service. Gas prices nationally, especially in the southeast and east coast, will see minimal impact at the pump if the pipeline is down for a matter of hours versus days.
Since Friday, Louisiana's gas price average increased from $2.81 to $2.83. The increase is expected as a storm like this can cause an increase in demand, due to panic buying, leading up to the storm.
However, people are likely to see a dramatic reduction in demand post-hurricane as many stay home due to power outages and road closures.
Property data company CoreLogic estimates that 515,952 homes were affected by Hurricane Ida's powerful winds - compared to Hurricane Katrina, whose winds affected 793,824 homes. Hurricane Katrina directly hit a more populated area than Ida.
Hurricane Ida made landfall near Port Fourchon, a significant transport for petroleum. Winds exceeded 145 mph and significant storm surge of 5-7 ft impacted the area.
The slow movement of Ida through Lousiansa will also result in extreme rainfall totals of 15-20" in a corridor from Southeast LA to South Central MS. As of Monday morning, over 90% of New Orleans remains without power, reports CoreLogic.