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Hurricane Sandy pushes gas prices ... down?

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Keith Bedford/Reuters

(Read caption) A gas station is submerged in floodwaters near the Gowanus Canal in the Brooklyn Borough of New York Oct. 29, 2012. Hurricane Sandy knocked out gas stations and refineries on the East Coast, but its biggest effect could be keeping motorists off the road, which is helping push down gas prices.

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For a superstorm, hurricane Sandy has had surprisingly little effect on gasoline prices.

On the morning after the storm made landfall, gas prices fell nationally by almost a penny per gallon. The following day, they fell another penny.

Even in areas hit hard by the storm, gas prices were up only nominally on the first day: less than a penny in Baltimore, Philadelphia, New York, and Boston, according to, a group of local websites that track gasoline prices. By the second day, they had stabilized or were falling again.

If anything, hurricane Sandy may be helping to push prices down faster.

That's because the storm hit an energy consuming area of the United States rather than an energy producing area. Thus, the impact of the storm will cause a bigger drop in demand than in supply. All those drivers in New York and New Jersey staying home could reduce gasoline demand by 1 million to 2 million barrels of gasoline per day over the next few days.

The storm also damaged two of the area's oil refineries, but that would account for a reduction in supply of only 200,000 to 300,000 gallons of gasoline per day.


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