Storm drives gas shortage
‘ Panic buying’ sparked by Harvey creates lines, sporadic outages
Panicking motorists are lining up at gasoline stations throughout central and north Texas, causing sporadic fuel shortages after Hurricane Harvey ravaged the region’s energy distribution network.
Lines have snaked around gas stations in San Antonio, Dallas, Austin and other cities, causing dozens of locations to shut down temporarily as they await new supplies.
Energy providers, meanwhile, are taking extraordinary measures to reroute supplies to the region after the storm knocked out nearly 30% of the nation’s refining capacity, according to the U. S. Department of Energy. In some cases, those efforts could lead to lower supplies in other parts of the country, such as Florida. Experts warn that drivers should not panic, because rushing to top off tanks couldmake the problem worse.
“There are certainly shortages occurring in retail stations in certain markets, however a lot of that is being driven by panic buying,” said Rob Smith, director of IHS Energy’s downstream practice.
Gas prices continued to spike nationwide amid the disruption, reaching twoyear highs of $ 2.52 a gallon Friday as the country headed into the long Labor Day weekend, according to AAA.
National retail prices could reach as high as $ 2.75 in the coming days after wholesale prices, a leading indicator, jumped sharply, according to independent projections Friday by GasBuddy. com petroleum analyst Patrick DeHaan and Oil Price Information Service analyst TomKloza.
Even so, prices remain below the record of $ 4.114 from July 2008, AAA data show.
Although the U. S. had some 230 million barrels of gasoline in storage as of Friday — ample supply in a crisis — transporting fuel from storage terminals to stations has been extremely challenging. That’s because several key ports along the Texas Gulf Coast were closed for most of the week, the critical Houston Shipping Channel was shuttered for several days and many local roadways have been impassable.
What’s more, the vital Colonial Pipeline, a critical source of energy transportation from Houston to the Southeast, has been operating at reduced capacity.
To resupply Texas, one company, Magellan Midstream Partners, reversed a portion of a pipeline that typically transports gas and diesel fuel from Dallas to Tulsa.
Suppliers on the Louisiana Gulf Coast are now sending energy to areas hit hard by Harvey instead of to Florida, which is now getting gasoline on barges from the New York region.
“Gasoline is coming, but instead of being a spigot it’s more of a trickle,” DeHaan said. “But over time the trickle will slowly start to increase.”
Kloza urged consumers not to rush to the pump unless they are low on fuel.
“There’s always folks that are yelling fire in a crowded theater, and panic can ensue— and to a certain extent there was tank- topping and desperation buying in Texas,” he said.
With the temporary redistribution of energy to aid the Gulf Coast, other markets could face shortages if buyers panic, analysts said. Kloza said Florida, Tennessee and possibly mid- Atlantic states could be at risk of tight supplies.
The good news for motorists is refineries in Texas are already aiming to reopen.