One analyst says gas prices are likely to go back down in a big way now that a refinery issue has been fixed. GasBuddy.com says gas prices could end up dropping 50 cents a gallon or more over the next few weeks now that production is ramping up again at the BP plant in Whiting, Indiana. But, how is it that one refinery can cause so much havoc on prices? "Because demand is so high, there's very little margin for error," says Patrick DeHaan, GasBuddy.com Senior Petroleum Analyst. "When you have the largest refinery in the Midwest going down completely unexpectedly, it catches many by surprise. This is a time of year when inventories of gasoline are fairly tight."
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DeHaan says another such problem with the refinery could cause a similar price spike. "They react to news that's very significant, and that's what we saw in this case," DeHaan says. "The seventh largest refinery in the country has a great impact on gasoline supply, and now that refinery being back online is going to mean much lower prices in the weeks ahead. Hopefully, there are no new issues to speak of." Gas prices average $2.99 currently in Illinois according to GasBuddy, and DeHaan says Labor Day won't be much of a price factor.