Former Shell Oil President John Hofmeister on Thursday said oil refineries in Texas are making a big comeback after Hurricane Harvey.
Continue Reading Below
“I think the big Houston machine is gearing back up. I think only four refineries are currently not in a startup mode or at some progressive level along that way. So the big machine that feeds this nation is coming back, coming back quickly and I think that’s all to the good,” he told FOX Business’ Stuart Varney on Varney & Co.
The Citizens for Affordable Energy CEO explained why gas prices go up after a natural disaster and come down slowly during recovery.
“Traders are the people who move molecules from the refinery to the distribution points and they will be very sensitive to price opportunities. They make their money when prices [go] up or prices go down. So when there is a chance of a shortage, they’re going to arbitrage and move prices up as rapidly as they can and then they only drift down,” he said.
Hofmeister said gas station owners, who have prepared for the hurricane and have fuel, should be careful of price gouging.
“I don’t think anyone is against the idea of making profit, but if you gouge people then you are doing something that really offends the moral conscience,” he said.