As China contends with the Coronavirus affecting one of its most populated regions, that nation's use of fossil fuels is drastically reduced, which is causing a ripple effect worldwide.
"You've seen China limiting its own population about the country," Eric Smith, a professor with Tulane University's Energy Institute says if China's not using fuel, there's a lot of it around.
"To a degree these things are disruptive, they're shutting down the use of fuels for transportation," Smith continues. "And that's what we make in the refineries along the coast."
Louisiana refineries mainly make fuels for transportation, and fuel stocks are running high at the moment.
The result has been a sizable drop in the price of regular gasoline across the region.
However, Smith cautions, "Yes the prices will come down, but as quickly as they come down--they go up quicker than they come down, lets put it that way."
And despite a glut of gasoline, diesel, and jet fuel and the low price for regular gas since most newer vehicles require mid-grade or premium gas, those prices are not moving.
Smith says higher grades of fuel can be as much as a dollar more a gallon at times.
But the drop in gas prices due to sizable fuel stocks is just the tip of the iceberg, China buys a lot more petroleum products than gas: "From a petro-chemical standpoint, which is really more important to Louisiana these days, all of the plastics that we are exporting, certainly their prices can do down."
But Smith maintains the U.S. is leading low cost producer of these products and he says the low cost maker always comes out ahead.
"There's a lag effect when prices are coming down," he says. "This is not going to last forever. The Gulf Coast refineries are world-class competitive installations. What you will see are higher cost refineries in other parts of the country are probably suffering more."
Smith says the slowdown due to the Coronavirus is temporary and the industry has prior experience dealing with this kind of crisis having learned from the effects of the SARS outbreak of 2002.