Gas hikes now could mean higher prices later

GRAND RAPIDS, Mich. (WOOD) — Filling up your tank will empty out your wallet: That’s the prediction coming from experts who keep track of prices at the pump.

The increase could also set the stage for more hikes down the road.

In December, the ExxonMobil refinery in Joliet, Illinois, had a malfunction that will not be fixed until later this year. On Tuesday, the Wood River Refinery just north of St. Louis had a flare that caused a partial shutdown there.

“As a result, wholesale gas prices today jumped double digits and that will probably lead to an increase at the pump in the days ahead,” Patrick DeHaan, senior petroleum analyst for GasBuddy, told 24 Hour News 8 in a phone interview Wednesday.

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Refineries are the culprit in most gas hikes these days.

“Whereas 20 years ago, nobody would ever hear of a refinery problem as a reason for gas prices going up — we have far fewer refineries than we did in the ’80s and ’90s,” DeHaan explained. “It affects supply immediately and it certainly causes gas prices to go up very quickly.”

What goes up does not necessarily come down at the same speed.

“I would look for gas prices up in the next couple of days, but once they go up, they will eventually start trickling down,” DeHaan said.

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On Wednesday night, the average price in the Grand Rapids area for a gallon of regular unleaded was $2.65. The state average was $2.66 and the national average was about $2.55, according to GasBuddy.

“A rough estimate is that gas prices could go up into the $2.70s. They may even go as high as $2.85. I wouldn’t expect much more than that,” DeHaan said.

While the hikes here are not too big, they set a higher baseline for the standard price hike that comes in the spring. DeHaan said spring prices could go up to $3 per gallon.