SOUTH BEND, Ind. (AP) — A large Indiana oil refinery whose unplanned shutdown for repairs earlier this month caused gasoline prices in the Great Lakes region to spike restarted Tuesday, leading experts to predict a quick drop in prices.
BP issued a news release Tuesday saying it has safely restarted a large crude distillation unit at its refinery in Whiting, 15 miles southeast of Chicago. The unit had been shut down since Aug. 8 for unscheduled repair work. Gas prices were about $2.384 on Aug. 9.
"Retail prices across the Midwest had been moving lower already for the past seven days or so after that issue first caused a spike. So the recent drop in prices may accelerate in the days ahead and in the next two to three weeks we could see prices drop some 20 to 50 cents," said Patrick DeHaan, GasBuddy.com senior petroleum analyst.
AAA Hoosier Motor Club reports gas prices hit a high of $2.976 in Indiana for self-serve regular unleaded on Aug. 16 in Indiana. Gas prices had been $2.36 on Aug. 11 and jumped nearly 53 cents in three days. The average price in Indiana on Tuesday was $2.74.
"It should mean gas prices should continue to go down, possibly even at a faster rate than they have been for the last few days," said Greg Seiter, AAA Hoosier Motor Club spokesman. "Understanding the crude oil prices are very low and remaining consistently low, this should bode well for drivers throughout the Great Lakes region."
DeHaan said gas prices began dropping last week amid reports that the refinery was close to getting back on line. He also said prices tend to drop down after a big spike.
"As we got more information over time about BP the markets kind of relaxed," he said.
DeHaan expects prices to eventually drop below $2 at some gasoline stations as some other parts of the U.S. already are seeing.
"It's just a matter of time before we start to see gas prices under $2 in Indiana, Michigan, Illinois and Ohio," he said. "With the return of this BP refinery, so long as there are no new outages from it, I would expect it's just a matter of a couple of weeks or a couple of months before we see the first stations at under $2 a gallon. The Whiting refinery was the only kink in the chain from delivering far-lower gasoline prices."