Gas prices quick to rise, slow to fall
Posted September 7
Raleigh, N.C. — Gas prices in North Carolina have climbed an average of 40 cents a gallon since Hurricane Harvey hit two weeks ago., and industry observers say prices aren't likely to come down until later this month.
Flooding from Harvey along the Gulf Coast is the primary culprit for the price spike, as refineries were damaged and still haven't returned to full operation. Also, a key gas pipeline from Texas to the East Coast was knocked out for a few days, further disrupting gas supplies.
But even with gas flowing through the pipeline again and refineries gearing up, the average price for a gallon of unleaded gas in North Carolina is $2.63, according to AAA Carolinas. Nationally, the average price is $2.67 a gallon, which is close to the the highest price Americans have paid for gas in more than two years.
"We've seen this in every event. When things settle down, gas prices tend not to go down as fast as they've gone up," said Mike Walden, an economist at North Carolina State University.
That phenomenon is due in part to buyers and in part to sellers, Walden said.
"Everyone doesn’t eat bananas, but virtually everyone uses gasoline. So, when people hear there’s a disruption in supply, they run into the station, top off their tanks," he said. "In economics lingo, that tends to increase demand and allows the seller to sell for more."
On the other end, he said, sellers think, "Well, people got used to this higher price, so I’m going to try to get a little bit more.
"I know that doesn’t sound fair to a lot of people, but it’s temporary," Walden said. "Competition will force those prices to eventually go down."
Attorney General Josh Stein said he expects gas prices to go down soon.
"That's where competition comes into play, and we need to be rewarding the businesses that are dropping the price most quickly and punishing those who want to hold on a little bit longer than they should," Stein said.
The Attorney General's Office has received about 350 complaints of price gouging at gas stations since Harvey hit, including 40 in the Triangle. Price-gouging laws remain in effect under North Carolina's state of emergency as Hurricane Irma approaches the East Coast, but charging excessively high prices can be hard to prove if most stations have similar prices, Stein said.