Gas prices will likely rise today

Local residents will feel Katrina's impact at the pump after 700 offshore rigs were evacuated.

Hurricane Katrina may have pounded the Gulf Coast, but Southeast Missourians will feel the effects, too -- not in the form of rain, but in dollars and cents at the gas pumps.

Katrina disrupted Gulf Coast petroleum output and rattled energy markets on Monday, sending oil and natural gas prices soaring and setting the stage for a spike in the retail cost of gasoline.

In Cape Girardeau, the price at the pump went up between 6 and 10 cents per gallon after noon on Monday, but those increases weren't due to the hurricane. They were based on changes in the gas market on Friday and Saturday, said Pajco Inc. co-owner Jim Maurer. Pajco Inc. operates all of the Rhodes 101 stores.

One supplier has cut the Rhodes stores off completely, and a couple of suppliers increased wholesale prices at noon on Monday, he said. He said that increase has not been felt by the retail market yet.

The gas market traded up 40 cents on the stock exchange all day Monday, Maurer said.

Cars streamed in and out of the Basic Fuel gas station on Bloomfield Road in Cape Girardeau Monday. George McLaird was filling up his vehicle. With the price of gas already at $2.42 when he was filling up, he said he knows gas prices are only going up again because of Katrina."It doesn't make me feel too good, but there is not really anything I can do about it," he said.

Like McLaird, Marie Walker filled up her tank to try and avoid filling up again later in the week when prices may be much higher.

"I wish I'd done it yesterday," she said.

She says it makes her feel stressed to try to keep up with the prices.

A number of factors could affect the price at the pump, including whether President Bush releases some of the nation's crude oil reserves, but Maurer said the biggest problem is that all the refineries off the Gulf coast are shut down.

By the end of the Monday, more than 700 offshore platforms and rigs had been evacuated, two rigs had drifted away and authorities in Alabama were forced to close a bridge over the Mobile River after it was struck by a runaway platform. Oil futures briefly climbed above $70 a barrel for the first time.

Analyst Tom Kloza of the Wall, N.J.-based Oil Price Information Service said the market reaction is a reflection of supply tightness, not shortages.

"Unfortunately, I don't think $3 a gallon is a hyperbolic number in some markets anymore," he said.

An estimated 633,000 barrels of crude oil produced daily by eight refineries have been halted, adding up to about 42 percent of the daily average output in that area.

"We're going to see some tightening up of product," Maurer said.

Normally when the product tightens the retail price rises, he said. Prices will not be changed at Rhodes 101 stores again until today at noon, Maurer said.

Illinois Governor Rod Blagojevich has asked Attorney General Lisa Madigan to investigate potential price gouging at Illinois gas stations.

"It is critical that we ensure that no one be allowed to use this natural disaster as an excuse to exploit consumers," Blagojevich wrote in his letter to Madigan.

Missouri Attorney General Jay Nixon's office will be on the lookout to make sure merchants in Missouri are in compliance with Missouri's law governing fair merchandising and practices, spokesman Jim Gardner said.

As for what happens next, the quicker the refineries get back online the quicker people will see some relief at the pump, Maurer said.

The powerful hurricane hit the industry at a time when producers worldwide were already struggling to keep up with strong demand, and it threatened to constrain the supply of home heating fuels this winter. The rise in energy prices has already slowed the U.S. economy's growth rate, though domestic fuel consumption is still rising.

The Bush administration said it would consider lending oil from the nation's emergency stockpile to refiners that request it -- Citgo Petroleum Corp. asked for 250,000-500,000 barrels to ensure its Lake Charles, La., refinery does not run out -- and the president of OPEC said he will propose a production increase of 500,000 barrels a day at the cartel's meeting next month. Analysts nervously awaited details on the extent of the damage to the region's platforms, pipelines, refineries and electric grid.

The Associated Press contributed to this report.

ameyer@semissourian.com

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