Severe fuel shortage grips parts of US southeast

[phantom power]

The effects on motorists have been dramatic. Most service stations in Atlanta are out of gas, with plastic bags placed over the pumps or signs saying "out".

As a result, drivers are cruising the city hunting for gas -- often with a fuel meter needle hovering close to empty. When they find gas, it's often above $4 a gallon.

Traffic is lighter on the city's streets and highways as some residents share rides and limit their journeys.

Lines and elaborate queuing systems have developed at gas stations on days when oil companies deliver fuel. Motorists report showing up at gas stations before dawn to beat the line only to find dozens of cars ahead of them.

"It's been very tough," said Rhonda Forrest, 45, who said she slipped out of work on Monday to fill up her tank when she learned that a gas station in the city's upmarket Buckhead district was open.

The shortage has also had a psychological impact. Like many U.S. cities, Atlanta is car dependent and residents say they had until now taken refueling for granted.

http://www.reuters.com/article/economicNews/idUSN2938618920080930

[RUMMYisFROSTED]

1. Queue 1973.

[Stellabella]

2. No kidding.

Just think - we had 35 years to prepare and avoid this. And nothing has been done.

Thanks, Reagan, you asshole.

[ixion]

4. 1973 was a proof-of-concept for gaming the world markets

it's worked out wonderfully for the top 1 percent.

[notadmblnd]

6. I don't understand why they're frozen with the inability to do anything.

Why haven't these southern state started a rationing program? Odd plate numbers on odd day, even plate numbers on even days? Limiting the number of gallons per car so more people have the opportunity to buy it. Part of the problem as I see it, is the hoarding.

[SIMPLYB1980]

3. That's what it looked like Friday in Gastonia, NC.

I only know of one gas station around that has gas right now. It's and Exxon station, I don't like buying from Exxon, and you can only get 30$ worth. Glad I bought my honda civic in 2004. Thanks Dubya.:argh:

[Lancer]

7. I hear you, SIMPLY.

In Chapel Hill, practically every station has "crime scene" tape around the banks of pumps, if the station is not also a convenience store. Otherwise, the whole lots are taped up in some places. Many stations have all the price numbers off the signs. If you can find a place that still has fuel, it's either diesel or just one grade (today at an Exxon it was 87 octane at $4 a gallon). I hate Exxon, too, although I guess they're all pretty much the same. Still, ya gotta buy what you can get. We have a 1990 Honda Civic and a 1994 Toyota Camry so we get a little more bang for the buck.

No lines around the block here because most stations have no fuel.

[Warpy]

5. Yet in the rest of the country, gas is plentiful and cheaper

Maybe my tinfoil hat's on too tight, but it looks like the GOP is terrified of losing Dixie and is trying to force more support for the "drill everywhere" party.

[tama]

10. Colonial

and other strategic pipelines delivering only very low percentage of normal amounts of gasoline from GoM to North-West. These are local phenomena.

[aasleka]

8. So what damage did the refineries suffer from the storms?

Enron manipulation.....

I sugest we call the state attorney and start a lawsuit or have them charged with price fixing.

There is no fucking way a simple power outage during the last storm caused lack of suppplies for fucking weeks.

[The Croquist]

11. Georgia has enacted an anti-price gouging law

My understanding is that they can't charge more then they were prior to the "crisis". Gas prices in the country are dropping but ours are not. Don't get me wrong, without this ordnance prices would be through the roof.

I don't drive much so yesterday was the first day I needed to fill up (call me lucky).
After two empty stations I drove by a third with gas and pulled in. I was about 4th in line but left because I didn't want to wait and they were charging $4.19 per gallon. I think they were cheating because gas was just under $4.00 per gallon pre-Ike. As soon as I pulled out I started bitching at myself. A few miles later I found an open station for $3.97 pulled in and I was second in line. I filled up and filled up a 5 gallon can as well. That makes me part of the problem*.

Then I went to the Kroger grocery store. They sell gas and the line was 30 plus cars. I told two people about the QT down the street but they didn't leave.

The issue we have is that people are scared. I saw a guy from the "Georgia Convenience Store Owner's Association" (or some such) on a Sunday morning show and he explained that their average current fill-up is 6 gallons. When I fill up my Celica I usually put in 12 - 13 gallons. I put in 12.85 gallons yesterday. My tank is smaller then average. People are obsessed with gas and it's making the problem worse.

A friend of a friend drives a gas truck. He says that they are delivering more then ever but it just isn't enough. I think 90% of the people in Atlanta are sitting on gas.

* People are filling up gas cans and putting them in their garages. It's where allot of the gas seems to be going.

[happyslug]

13. Same thing happened in 1973 and 1979, people keep the cars filled

Most people during "normal" times fill their car when it is about 1/4 of less full, during the 1973 and 1979 oil crisis these same people would fill their tanks when the tanks were still 3/4 full, they wanted to make sure they had gas when they needed it.

From what I have read this is normal and the main reason the US impose gas rationing during WWII, Not to cur down usage, but to prevent people from keeping their tanks filled up instead of leaving the tank empty out as in normal times (Gas rationing was imposed for other reasons, for example the US wanted to keep the price of oil low for the US Government was buying a lot of it to fight the war, but the need to give people assurance that they will have gasoline when they need it was an important factor).

As to why it is hitting the Southeast NOT rest of the country, is that the problem is NOT the refineries but oil through the Texas to New Jersey oil pipeline. The Pipeline had been built during WWII so we could ship oil to the North east and avoid the German U-Boats. After WWII the Southeast expanded and came to depend on that pipeline for its oil. The Mississippi/Ohio/ Missouri River system depend on Barges for its oil shipments (Going as far east as Pittsburgh). The West Coast relies on its own oil shipments. The American West relies on its own pipelines and/or rail shipments. The Northeast imports it oil from overseas (with most of its refineries in New Jersey). The Upper Mid West, when it is not importing oil from New Orleans via barges, is importing oil from Alberta Canada via pipeline. That leaves only the Southeast dependent on that old WWII era pipeline. The pipeline while designed to ship oil to New Jersey, is primary used to ship oil to the Southeast. The only other way to get oil into the area is by truck (The Railroads do not have enough tankers to haul the oil and even the trucks are limited). Because the pipeline supplies enough oil for 60 years no one in the Southeast ever thought up about having local supplies, and with just in time inventory becoming the rage in the 1980s, no one even thought of it when supplies and demand equaled out.

Thus you have a system in place that depended on the pipeline suppling the gasoline/oil needed but no storage of such oil. In my area (Pittsburgh and Western Pa), which is supplied by barges a big fear is the water way closed down for 0ne to two weeks (Which has happened) so the terminals of the Barges have large storage tanks for oil to keep on hand two to three weeks of supply if are cut off. Furthermore since we use barges, we can delay the barges for the blockage then bring them AND additional barges in to supply us fuel. Both of these features build in a safety net of additional fuel that can be provided within about a week of any shut down of the River. In the US Southeast no such safety nets exists. Furthermore given the efficiency of the pipeline no secondary system such as Train tankers and truck tankers exist to haul in fuel from other areas. Some trucks do exist but the driver has to give up his regular run to run to a distribution center NOT on the pipeline to get fuel and haul it back to the Southeast. Some of this is happening, but that means other drivers have to take over that driver's route which further slows down shipments to the gas stations.

Remember the problem is the pipeline had to be closed down for Gustav. When Gustav hit parts of the pipeline was exposed, which shut it down till the pipeline was recovered with dirt and tested for leaks (pipe designed for underground use depend on the ground to hold the pipe in place, without ground around the pipe, it can break and leak, thus the need to cover the pipeline over and to test it for leaks BEFORE oil and/or gasoline can be shipped through it). This is what caused the problem, Gustav exposed the pipeline, which meant the pipeline had to be shit down and recovered and tested. That took time, and during that time whatever supplies that existed in the Southeast was used up. At that point Ike appeared and shut down the refineries, which meant nothing could be shipped through the pipeline. Again the pipeline had to be checked (at least it did not have to be recovered). This added another week to the lack of oil being shipped, and whatever oil that had gone through was used up as soon as it hit the distribution points do to the fact the inventory had already been used up during the wait for the pipeline to open up.

Thus the problem is the just in time inventory system that the pipeline encouraged. The pipeline unable to deliver oil for three weeks (Two weeks do to Gustav, one week do to Ike, Gustav do to potential damage to the pipeline, Ike do to the refineries being shut down so they was no gasoline to ship through the pipeline). The southeast did NOT have three weeks of inventory of gasoline, thus a shortage occurred. The solution is the pipeline suppling the gasoline (And it is) but that will take time for the pipeline has to supply three weeks of supply (Four weeks if you include the week the oil is shipped). This will take time. I do not think the pipeline can supply more then two weeks of supply at a time (and I have my doubts even at that level). This problem will be resolved over the next few weeks as gasoline supplies are pumped through the pipeline and gas stations get what their normally get in supplies. Once that is achieved then inventory will be built up. It will take time, exactly how long would depend on how much gasoline is used in the Southeast AND how much oil can be shipped through the pipeline (And whatever other shipments can be made to the Southeast). I suspect the problem will last only a couple of more weeks, but the Southeast is probably the most car depended area of the US, the alternatives to Gasoline and cars are limited (If they exists at all). You do not have the Subway system of the large cities (New York etc), and most of the major Cities (Atlanta, Charleston etc) do NOT have the mass transit system of Northern Cities. The distances people have to travel are to far for most bicyclist (Where bicycling is possible given the tendency in that part of the South to go to fast in their cars). The best solution would be a cut back in Gasoline demand, but I can NOT see how that can be done given how depended the area is on cars and gasoline.

[The Croquist]

14. What an impressive post.

I'm a little nervous just replying and questioning some of it because you know much more about it then I do. Here goes:

My understanding is that WWII gas rationing was aimed at lowering personal use of gasoline.

Do you guys really ship fuel up the Mississippi by barge? I understand that barges are cheaper then rail but wouldn't a pipeline be cheaper and more reliable? A pipeline can operate in bad weather conditions and it doesn't require the energy of moving a barge weighing many tons up and down the river. Obviously the pipeline let us down recently but as you posted, the midwest has more tank storage built into their infrastructure then us rebels because of the unreliability of barges.

By the way the "crisis" has eased just since yesterday. I think we're over the hump and within a week or so we'll see prices beginning to drop down to national averages.

Georgia used to have cheap gas but our state gasoline tax is a percentage of the price (adjusted every 6 months) so when oil spiked the state got a big increase in revenue. As a result we were about average pre-shortage. Today we don't even look at the price although the state is actively investigating price gouging. We'll see what comes of it.

[happyslug]

16. No Fuel has been shipped by barges for Decades

Natural Gas is shipped by pipeline, but Western PA is a huge supplies of Natural Gas itself. You must remember when it comes to Natural Gas it is cheaper to ship by pipeline then any other way for to ship it you must compress it, and compression takes about the 1/3 of the energy being compressed to do the compression. Thus Natural Gas is shipped by pipeline whenever possible (and why Russia is viewed as a threat to the US over the next 20 years, Russia has pipeline from its own Natural Gas reserves as while as Iranian Gas reserves. Control of those pipeline gives Russia a HUGE amount of Power over Europe. Furthermore Given that North American Natural Gas Supply is about to peak out and drop in production, the US will have to import Liquefied National Gas from the Persian Gulf, at a price 1/3 more then Europe will being paying (Do to the fact the US will HAVE to compress the Natural Gas, while Europe can get theirs from Russia via a Pipeline).

While a pipeline is the best way to ship a gaseous substance like Natural Gas, Oil and Gasoline are Liquid products and barge shipments are competitive. Furthermore barges can act as inventory, i.e. sit outside a Distribution Center with they load until it can be unloaded, adding to the inventory of any distribution center by just sitting at the center. These two factors are enough to keep most oil and gasoline shipments going by barge even to Pittsburgh and Morgantown West Virginia.

Now once at the distribution centers I suspect some pipeline are used (For example on US 22 north of Greensburg PA is an old Gulf distribution point, now controlled by Sheetz, and I suspect it is supplied by pipeline from the Monongahela, just an easy spot to ship gasoline to via a pipeline and then by trucks throughout the mountains of Western Pennsylvania).

[phantom power]

15. We have a situation kind of similar here in Phoenix.

Our gasoline supply is via a pipelines coming from Texas. In 2003, one of these pipelines (running through Tucson) ruptured, and for a little while we looked something like Georgia does now.

http://www.cnn.com/2003/US/Southwest/08/18/phoenix.gas.crunch.ap/

[One_Life_To_Give]

12. Just closing for a day or two

The real question is how many days of production at Max capacity are required to make up the difference. If they normally run at 90% capacity they could make up a two day outage in under three weeks. At 99% capacity it takes over three months to catch up.

[tama]

9. Two hurricanes

like precision bombs hitting the most vital nodes of GoM oil infrastructure.

Mother Nature trying to tell something?