Post-Harvey Uncertainty Affects California’s Oil Market

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SACRAMENTO -- A spike in gasoline prices during the Labor Day travel weekend is not unusual, but it has gone up even more because of shortage fears created by Hurricane Harvey.

The Houston area oil refineries produce 20 percent of the country's gasoline and at least 10 refineries shutdown during the flooding.

Californians expected the price spike that amounted to around 5 cents a gallon in the days before the holiday weekend.

But others questioned the increases because California doesn't get any gasoline from Texas. Instead, refineries in California make a make a special blend required in the State.

Some oil analysts say Harvey has created uncertainty in the gasoline market. For instance it's unknown how much of California's production must go to Mexico to make up for lost supplies from Texas.

But some insist the gas price increase in California is bogus.

"I figured that hurricane must have hit Richmond and knocked out the Chevron refinery before it got to Texas. Why is our gas so high?" asked Sacramento motorist Mark Henig.

Many expect prices to drop quickly because there is an ample supply of oil reserves and many of the Texas refineries sustained little damage with several being shut down as a precaution.