U.S. gasoline prices jumped 6% in February, and market experts predict they will climb higher because critical refining operations in the Northeast are shutting down.
From New York to Philadelphia, refineries that turn oil into gasoline have been idled or shut permanently because their owners are losing money on them.
Sunoco Inc. is expected to close the region’s largest refinery in July, taking another 335,000 barrels per day in production capacity off the market.
The East Coast refineries are getting squeezed by the soaring cost of crude oil, the major component in gasoline. The cost of oil has jumped in the past year due to global economic growth and rising tensions between Western nations and Iran, a major producer. Refineries haven’t been able to increase their own prices enough to compensate.
The government said Friday that the increase in gas prices had contributed to a 0.4% overall increase in consumer prices in February. Prices at the pump averaged $3.831 a gallon on Friday, according to the AAA, formerly known as the American Automobile Association.