5 Reasons Why There's a Gas Shortage

Hurricane Sandy has claimed hundreds of houses, dozens of lives, and left millions without power. In the aftermath, another victim emerged: gas stations and their customers.

At stations throughout New York and New Jersey, customers have had to wait for hours for fuel?sometimes being allowed only half a tank, and sometimes not getting fuel at all. The Huffington Post reports that lines for gas stations on the New Jersey Turnpike stretched for more than two miles on Friday afternoon, and people were waiting up to six hours for fuel. On Thursday, CNBC reported that 80 percent of gas stations in New Jersey were closed.

Here?s why it?s so hard to get gas in New York and New Jersey after Hurricane Sandy:

1. Many gas stations still don?t have electricity.

When a station can?t get any power, this exacerbates the situation. First, the gas in the underground tanks is inaccessible without electricity, which decreases the available fuel supply in the region. Secondly, the closed stations? would-be customers must head to other gas stations, burning fuel on the way and making those lines longer.

2. Wholesale gasoline suppliers are without power, too.

Wholesale gasoline suppliers have gas, but they don?t have electricity to pump it into the tanker trucks for distribution. "This is not a supply problem, this is a delivery problem," said Sal Risalvalto, executive director of the New Jersey Gasoline-Convenience-Automotive Association. "What I?m seeing is there?s a combination of problems. Power is at the root of it. That means gasoline that is already in inventory, already refined in those big tanks you see along the side of the turnpike, [but] they can?t get that gasoline into the delivery trucks without power."

There were some inventory problems early on. Colonial Pipeline an Atlanta-based company that distributes 15 percent of the East Coast?s gasoline through its pipeline network that extends from Houston to New York City, lost power. Colonial was unable to pump their regular 700,000 barrels a day at their Linden, N.J., but power was restored and fuel delivery resumed today.

3. Panic buying.

Once gas becomes difficult to get, people get less comfortable running near empty. The uncertainty of where the next tank of gas will come from has a profound psychological effect on people and leads to panic buying. Someone who had been perfectly happy running on 1/3 of a tank of gas before the emergency will rush to fill up after disaster strikes. Under normal circumstances, the roads are full of cars at varying fuel levels?at any given time, some people are close to the F, some are close to the E, and most are somewhere in between. But when everyone fuels up at once out of fear, it can be enough to run stations dry until they catch up with demand.

4. Turnaround time.

Dan Freihofer, president of New Hampshire-based commercial gas distributor Freifuels, tells PM that even the wholesalers who do have power are struggling to keep up with post-Sandy demand, since service stations must be refueled so much faster.

"A typical station has a 10,000-12,000 gallon tank. A tanker truck-load is 7500-8000 gallons, so a new load won't fit until gas station is nearly empty. With such rapid consumption, it's much more likely that a distributor can't hit a customer's desired delivery window, resulting in a temporary outage, which only feeds the hysteria."

5. Self-service.

New Jersey is the only state with mandatory full-service at gas stations (you can?t pump your own gas even if you want to). While this minor inconvenience is usually offset by New Jersey?s lower gas prices, the influx of customers means that gas stations are struggling to keep all their pumps manned, which slows down long lines even more.

Source: http://www.popularmechanics.com/cars/news/industry/5-reasons-behind-the-gas-shortage-14371363?src=rss

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