The average price of gasoline nationwide has already shot up 12 cents in the past two days to $3.795 a gallon, according to figures released by the AAA Sunday. And the average price of gas is now at or above $4 in Alaska, Georgia, Hawaii, Illinois, Indiana, Michigan and South Carolina.
In addition, Hurricane Ike could turn out to be the third-most expensive natural disaster in U.S. history, according to preliminary forecasts from a firm that does loss estimates for the insurance industry.
Experts say it's too soon to know exactly how much damage the hurricane - which slammed into Galveston, Texas, early Saturday - did to the refineries.
Some early reports suggested that the damage could be limited despite the nearly direct hit.
But the output at the refineries, which produce nearly 25% of the nation's gasoline, could still be affected if it takes weeks or months to restore full power to the region.
The uncertainty left experts projecting everything from a nationwide gasoline spike above $5 a gallon to a jump to just below the $4 mark.
Gas prices already climbingMany consumers throughout the Southeast have already started to see sharp increases in gas prices before the storm even hit. The latest nationwide survey by AAA conducted Friday showed that prices were up nearly 6 cents a gallon to $3.733.
Some areas, particularly in the Gulf Coast and South, have been hit with a more than a 20 cent a gallon overnight increase. For example, the price of gas jumped 27 cents in Knoxville, Tenn., to $3.924.
"This is a fear factor among station owners," said Kevin Kerr, editor of Global Commodities Alert. "They're worried that they're not going to get any more supply or if they do it's going to be a lot more expensive."
Gas prices soared three years ago in the week after Hurricane Katrina slammed into New Orleans. Prices jumped 17% to a then-record high of $3.0569 due to damage to refineries and pipelines.
In a statement to CNN, the U.S. Department of Energy said it "is very concerned about the impact of gasoline prices on American families" and encouraged people to report price gouging at its Web site.
The Department of Energy added that it is ready to release crude oil from the Strategic Petroleum Reserve "when and where it is necessary to ensure refineries are capable of maintaining operations" and that is analyzing the amount of fuel production likely to be lost because of Hurricane Ike and Hurricane Gustav, which hit near New Orleans on Sept. 1.
Kerr said the path of Hurricane Ike was the worst possible scenario. There are about 20 refineries between Lake Charles, La., and Corpus Christi, Texas. All of them saw winds and heavy rain from the storm. Together, they can refine nearly 5 million barrels a day.
Almost half of that capacity is concentrated in the Houston-Galveston area - where the center of the storm hit. In addition to area refineries, gasoline pipelines and other key transportation infrastructure could limit the supply of gas reaching consumers.
"We could see gas go up to $6 in certain states," said Kerr. "I think the baseline will be more like $4.50, maybe even $5."
The ExxonMobil (XOM, Fortune 500) refinery in Baytown, Texas, with a daily capacity of 567,000 barrels, is the largest refinery in North America. And the eye of the hurricane passed right over it.
CNN correspondent Ali Velshi reported Saturday morning that there was no apparent damage to the outside of the refinery, despite extensive damage in Baytown.
Kevin Allexon, spokesman for ExxonMobil, said the company has not yet determined if there was damage that could further disrupt operations.
"There's still some pretty significant weather that affects how safe it is to do assessment work," he said.
Oil analyst Peter Beutel of Cameron Hanover said he's encouraged by initial reports suggesting that crucial oil facilities in the region survived without substantial damage. He's hopeful that if refineries can resume near normal operations later this week, gas prices will remain below record levels.
"Right now it looks like we took a licking and we kept on ticking, although it's still early to get full reports," he said. "As of now, I don't have reason to believe it's going to be a lasting factor. It doesn't look like you'll get to $4 nationwide, but you'll see $4 gas in a number of places," he said.
But Tom Kloza, the chief oil analyst for the Oil Price Information Service, which provides the data for the AAA survey, said he's worried about how long it will take to get full production going again.
"Even if we missed the worse of it, it's going to be a mess," he said. "U.S. refineries are really dependent on local utilities. When you hear them talking about power outages lasting for weeks, it's a worry."
The Department of Energy reported that 2.4 million customers were without power as of Saturday morning, essentially everyone in the direct path of the hurricane.
Kloza said fear of a political backlash could keep oil companies and wholesalers from raising prices as high as the market might support in the face of such a tight supply.
But he said that even if consumers are spared the full brunt of price increases, they could end up dealing with limited supplies in some markets.
"You're going to see a lot of stations in some places that don't have gasoline and you'll see some lines," he said. He's predicting nationwide gasoline prices to rise to about $4 a gallon, give or take a dime for the next month.
What's more, production at refineries along the Gulf Coast had yet to return to normal since they shutdown in preparation for Hurricane Gustav, even though the hurricane caused limited damage.
Kloza added that jet fuel, diesel and heating oil prices could sharply increase - partly because they don't get the public attention or political scrutiny that gasoline prices do.
Ike cost may only lag Katrina and AndrewBut Hurricane Ike will prove to be costly even beyond the impact on gas and other energy prices.
Catastrophe risk modeling firm AIR Worldwide Corporation said Saturday that it estimated insured losses to onshore properties would be between $8 billion and $12 billion. The firm said it expected significant wind damage to skyscrapers in Houston as well as to mobile homes and warehouses.
And Eqecat Inc., a firm that makes catastrophe estimates for the insurance industry, initially forecast insured losses from Ike at between $8 billion and $18 billion.
The low end of that estimate would make Ike the fifth most expensive storm in history after adjusting earlier storms' costs for inflation.
But the high end of that forecast would put Ike behind only Hurricanes Katrina and Andrew as the most expensive natural disasters, according to the Insurance Information Institute.
Hurricane Katrina cost insurers an inflation-adjusted $43 billion, while Hurricane Andrew, which hit South Florida in 1992, cost the industry an inflation-adjusted $22.9 billion.
Gas prices weathering Gustav - so far
