AAFES gas prices spike after stateside hurricanes
September 19, 2008
After more than two months of price declines, gasoline prices will rise nearly 19 cents a gallon Saturday at Army and Air Force Exchange Service locations in Germany and United Kingdom after back-to-back hurricanes forced the shutdown of one of America’s primary oil production regions.
There is one bright spot in the exchange’s weekly fuel price adjustments, announced Thursday: Diesel prices in Germany and the U.K. are both down — 2.4 cents and 18.2 cents, respectively.
Gas prices in the Netherlands are up more than 10 cents, and diesel is up an even 14 cents.
An exchange spokesman confirmed that the expiration date for AAFES fuel coupons, which can be used at off-base Esso stations and Aral stations on the autobahn, has been extended to Dec. 31.
The government’s energy tracking agency warned that prices could creep higher because of disruptions to gulf oil production. But U.S. prices sank 2 cents a gallon on average Thursday after reaching $3.855 a day earlier, according to the American Automobile Association. Crude prices tumbled in trading earlier in the week in the face of widening troubles in U.S. financial markets and on the news that the hurricanes weren’t as devastating as some had predicted.
"At this point, in contrast to the impacts of Hurricanes Katrina and Rita, it appears that the petroleum industry did not experience much damage," the U.S. Energy Information Administration reported Wednesday in its weekly update of U.S. energy markets. "Nevertheless, supplies have been affected."
Nearly all oil production in the Gulf of Mexico — 1.3 million barrels a day — was still shut in as of Wednesday, EIA reported. More than 1.4 million barrels of crude from the strategic petroleum reserves are being delivered to refineries that weren’t affected by the hurricanes in an effort to make up for some of the loss.
"For consumers, retail prices are already high and could go higher in some areas depending on how long shut-in petroleum infrastructure remains offline," according to the EIA’s weekly petroleum status report. "After a shutdown of this magnitude, and with many areas of the distribution system drained of product, it will take some time for flows to resume."