Guest Post: US Midwest Hit By Perfect Gasoline Storm

Tyler Durden's picture

Submitted by Daniel Graeber of,


Retail gasoline prices in the U.S. Midwest were as much as 50 cents higher than in the rest of the country. By Monday, the price of a gallon of regular unleaded jumped 13 cents from last week in Detroit to settle at $3.99.  The spike in retail gasoline prices follows a series of pipeline spills in Wisconsin and refinery shutdowns in Chicago and elsewhere. The impact of the string of industrial incidents on consumers in the region may be short-lived, but retail prices rarely decline as fast as they increase.
The American Automobile Association, in its daily gasoline report, states a gallon of regular unleaded gasoline in Detroit cost $4.05, up from the $3.69 average just one week ago. Chicago drivers, meanwhile, were paying on average $4.39 per gallon, a 10 percent increase from last week. According to AAA, the national average for a gallon of regular unleaded is $3.62.  While that's a far cry from the national spikes early this year, the regional blow has irked many area residents wary of high consumer prices and pipeline incidents.
An industry analyst said much of the region was hit by "a cluster of bad luck." Last month, pipeline company Enbridge reported a leak on a pipeline in Wisconsin. A section of the Lakehead oil pipeline system ruptured there, cutting off oil supplies to Chicago-area refineries. U.S. Transportation Secretary Ray Lahood said the incident was "absolutely unacceptable" and forced Enbridge to keep the line closed until authorities review a restart plan for the entire 467-mile pipeline.
In Michigan, the state's governor last month issued a fuel emergency in response to the rupture of pipeline that released 1,000 barrels of unleaded gasoline in eastern Wisconsin. Gov. Rick Snyder's emergency declaration lifted the restrictions placed on long-haul truckers so they could deliver retail petroleum products. Less than two weeks later, Enbridge confirmed that 1,200 barrels of oil spilled from Line 14 in central Wisconsin. A nearby resident said the pipeline "blew like an oil well."
Enbridge maintains that "better than 99.999 percent" of the time, there are no problems with its vast network of oil pipelines in the United States. When accidents do happen, however, they're costly. Last year's oil spill in Michigan, on the same network as the Wisconsin leak, was the costliest onshore incident in U.S. history and EPA authorities are still reporting sheen in some of the waterways soiled by the release. Refineries, meanwhile, have shut down at a time when the region is using "summertime gasoline," a blend not manufactured very much outside of the Midwest.
Patrick DeHaan, a petroleum analyst at reporting Web site, told a Chicago newspaper that the regional spike in gasoline prices is temporary and likely "the last hiccup" for the summer. Nevertheless, gasoline prices rarely experience a 10 percent decline overnight.
"As we all know, (retail prices) only move down by pennies per day," he said.

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Think for yourself's picture

So, again... what was the historic ratio of oil barrels to gold... bitchez?

francis_sawyer's picture

Not sure if the Sumerians were interested in oil barrels... lol

From what francis_sawyer recollects, Herodotus never said much about it either...

francis_sawyer's picture

show me the afterhours "ticks" forensics & I'll let u kno...

El Oregonian's picture

ESSO Slogan: "Put a Tiger in the Tank".

Or, was that a fire in the tank?

After yesterday's Richmond Refinery mishap i'm not sure how it went.

CompassionateFascist's picture

Clear-cut terrorist op by Iranian Revolutionary Guard. It's half-past time for Isramerica to retaliate.

Bringin It's picture

Enron and it's effect on the California Dream was a serious wake-up call for the in-your-face fraud that was to follow. 

macholatte's picture

Enron and it's effect on the California Dream was a serious wake-up call for the in-your-face fraud that was to follow.

Yes. But unfortunately, not many woke up and most went back to sleep. Think it through..... people died because of the energy blackouts that were fabricated by Enron, but nobody was indicted for manslaughter. A couple of guys took a fall, one dropped dead, a couple of companies got reorganized and the golden parachutes opended right on time


So what's the lesson to be learned?



kliguy38's picture

Forget oil and gold.........think CORN

nmewn's picture

Lemme get this solar panel out of my eye first.

El Oregonian's picture

Korn? oh, nice Heavy Metal band...

Buckaroo Banzai's picture

Baby_BLYTHE is back? Where the hell have you been?

Joke Heros's picture

Had to be Phoenix Ozzfest, doesn't look like the Berdoo stage. Hung out with the fine folks from Slayer quite a few times. Tom's in his 50's and still has some wind in his pipes. Nice flashback.

Lednbrass's picture

Now THAT was a band to see back in the day. Tom Araya is the only musician I have ever seen beat the hell out of someone on stage- during a show in about 1986 or so I saw some dude get up on stage and reach for his mike (metal was alot more interactive back then) and boy was that a bad move. Araya grabbed him, threw him down, hit him with his bass and proceeded to literally kick the crap out of him until the roadies or security dragged him off stage. Got a good four or five hard boot shots on the dude, I was literally a dozen feet away right in front of the stage and he damn near lifted the him off the ground on a couple of them.

Good times, good times...

dark pools of soros's picture

I love Slayer but they did destroy the mosh/slam dance scene. But west coast never understood it anyway

LMAOLORI's picture



"Forget oil and gold.........think CORN"


Good advice


Food Supply Shock - $10 Corn Coming: Top Hedge Fund Manager

dunce's picture

Others here have noted the refinery fires that will also be impacting supply but your comment reminded me that there was a train fire in Montana involving 8 cars of alcohol which i am guessing was made from corn that can not be shipped in pipe lines because of corrosion.

Gully Foyle's picture

Odd how the TWO recent refinery fires are not even mentioned.

RICHMOND, Calif. (AP) — A major fire at one of the country's biggest oil refineries that sent hundreds of people to hospitals with complaints of breathing problems will push gas prices above $4 a gallon on the West Coast, analysts said Tuesday.

The fire, which sent plumes of black smoke over the San Francisco Bay area, erupted Monday evening in the massive Chevron refinery about 10 miles northeast of San Francisco. It was out early Tuesday.

Fire breaks out after explosion at Okla. oil refinery
mjcOH1's picture

"Odd how the TWO recent refinery fires are not even mentioned."


Well there you go again, expecting mainstream media journalists to do background research.

"Never ascribe to malice that which is adequately explained by stupidity."  - Hanlon's Razor




slewie the pi-rat's picture

the richmond fire was covered here last nite:  pictures, choppers, 3 TV feeds

from the goobermint point of view, the sales tax revenue on these higher prices and laborDay volume will be most welcome

faceBook did a face-plant, and the economy sux, so we gotsta pay for the hi-speed rail boondoggle somehow, BiCheZ

bigOil and the tax- & fee-hungry goobermints have the same interests (within reason)?  

well there's a big corpo-fascist surprise!

toady's picture

They'll talk about that Friday when SE and Cali prices are spiking.

ZenOps's picture

Not sure about gold, but in 1970 one $100 box of Canadian pure nickels would buy 40 barrels of oil.

AssFire's picture

My government's ethanol subsidies was supposed to ensure low gas prices...

What are you gonna tell me next? There is no corn to eat or make into gasoline additives?

I'll bet someone will say that ethanol stuff was all about promises to the Iowa primary fever..

When will you people learn the governments infallibility is as sanctimonious as the Pope's??

You didn't build it.


Haole's picture

The ethanol mandate... The hypocritical war on common sense to go along with the war on drugs, war on terror, etc., etc., etc.

At least the people can be truly satisfied that they didn't build that kind of government-mandated, net loss energy source stupidity and let the idiots in government have all the undisputed credit for that fiasco.

You're right .gov, we didn't build that idiocy, we had lots of help.

Row Well Number 41's picture

I remember when I was growing up, the first clue I had that something was deeply wrong with our country was this endless need to declare war on everything.


AssFire's picture

If you want something to explode out of control seems all you need to do is have the government create a war on it.

engineertheeconomy's picture

All Americans are Terrorist's and need to be killed by the Government... There's nothing wrong at all with our Government, we're the problem. We should all just kill ourselves today and save the government money, what with their imaginary crisis and all. Plus it would like totally avoid all the lines and unpleasantness. You go first, I'll be right behind you...

Paracelsus's picture

I remember in the sixth grade (1969?) looking at a quarter coin on edge and wondering why there was a big copper sandwich center,and thinking Hmmmm....

Wish I'd bought gold then (and Apple). 

HungrySeagull's picture

I did not buy shit in that time period.

I should have bought silver, gold.

I recently accessed some coins dating back to 60's on back to the 1910 era. They were quite something.

Even the Proof Sets of the late 60's had something that the 90's did not. That something must have been that silver.


I am betting a nickel is a nickel and it is worth saving a few rolls a month.

Dr. Engali's picture

And people buy into it over and over. Then they look at me like I'm nuts when I ask " so when do we get to declare victory "?

Chuck Walla's picture

So, Obama has corrupt republican, Illinois pol, Ray LaHood, take all that oil off line. Now this pleases Obama in one sense, but it displeases the Obama leg-humpers and electorate in general. What to do? Let the new Plantation dwellers drive their cars and cultivate their votes? Or stop the oil and piss them off?   

Change you really have to wonder about...



vinu02's picture

This days everything is rallying on hope.  Sooner analyst will add hope column along with eps, p/e ratio, revenue.

Bringin It's picture

It's the Fed feeding free money zirp, to it's client base.  They can profit in FRNs while treading water.

Deathrips's picture

Some cow in Chinas gonna be pissed, with wilted dinner.

Dr. Engali's picture

It's all good. The city I live in is starting to look more and more like a third world country every day.  Everywhere I look I see people buzzing around town on these little scooters, and bicycles with little racks full of junk. A couple years ago you never saw them. Now they are all over the place.

booboo's picture

Lights out deuce and a half convoys in Vietnam were hell on those scooters. Wait till the military starts running the streets of Detroit blacked out with MRAP's, be like a bug hitting a windshield.

mjcOH1's picture

"It's all good. The city I live in is starting to look more and more like a third world country every day.  Everywhere I look I see people buzzing around town on these little scooters, and bicycles with little racks full of junk. A couple years ago you never saw them. Now they are all over the place."


And jabering in some unintelligible but remotely English based language no less.

Hapte's picture

"English based"? Like Patois? Or Pig latin? Or klingon? "Jaber"? is that "English based" for "Jabber". You seem like an idiot, maybe future comments will prove otherwise.

madcuban's picture

Want cheaper gas?  Take out all this ethanol.  It will even be more efficient.  Want even cheaper gas, get rid of the dozen different grades during different seasons and go back to the most basic 87, 89, and 93.

Dr. Engali's picture

Want even cheaper gas? Go back to precious metals for a currency. A gallon of gas in the 60s cost two silver dimes. Fast forward to today and those same two silver dimes will still buy a gallon of gas.

GeezerGeek's picture

Works for Ferraris, too. 1962 Ferrari 250GT, brand new, 12,500 silver dollars. That's equivalent to somewhere around $300K today. I haven't looked lately, but I bet there is at least one Ferrari available at that price. Too bad my grandfather only gave me 100 of them (silver dollars, not Ferraris) as a gift that year. Also too bad I lost them in a boating accident.

FieldingMellish's picture

Stackers and boats don't mix for some reason.

viahj's picture

improper weight distribution, we all can't be engineers.

HungrySeagull's picture

There are stations here in Arkansas that have done just that. Regular gasoline unleaded.

Cost you a bit more, but the vehicles love the stuff.

GeezerGeek's picture

I heard Obama just claimed it was Bush's fault.

nmewn's picture

But but but...we have ethanol...and little fucking ferrets blowing on windmills under the hood.

We'll be OK!!!

mjcOH1's picture

And billions of stored BTUs in excess body fat.   We're good.