Tyner: High gas prices likely to stay around a while
WEST LAFAYETTE, IN -- Gasoline prices that spiked in Indiana and some other Midwest states in recent days likely will remain high until a unit at a refinery in northern Indiana is repaired, Purdue University energy economist Wally Tyner says.
One of three lines at the BP's refinery in Whiting, Indiana, is down and is expected to remain so for several weeks. The refinery is the largest in the country outside the Gulf of Mexico.
"Prices went up very quickly once the severity of the outage was clear," Tyner said. "The prices will remain high until Whiting comes back on, although they may drop down a bit as some supply comes in from other regions."
The unit that is shut down produces about 7 million gallons of gasoline and diesel a day, and Indiana consumes about 16.8 million gallons a day, Tyner said. The loss from the shutdown is equivalent to about 40 percent of Indiana's consumption.
Tyner expects the impact of the outage to be felt primarily in Indiana, Illinois and Michigan, regions closest to the Whiting refinery.
"Crude oil price continues to be very low, so most other regions will not be affected much," he said.