Atlanta Gas Scare
 

ATLANTA — Metro Atlanta drivers are facing the possibility of paying considerably more than $3 a gallon for gas by Labor Day — if they can get it at all.

The two pipelines that bring gasoline and jet fuel to the region are down — powerless to pump as Hurricane Katrina wreaked havoc on electrical infrastructure.

The metro Atlanta region generally has about a 10-day supply of gasoline in inventory, said BP spokesman Michael Kumpf. The pipelines have been down for two days.

Alpharetta, Ga.-based Colonial Pipeline Co., cut off from its suppliers on the Gulf Coast, is now pumping gas from huge storage tanks, many in Powder Springs, Ga. Whether electric power can be restored to the pipeline pumps before supplies run out is "the great uncertainty ... that hangs over all of us," said Daniel Moenter, a spokesman for Marathon Ashland Petroleum, a major supplier of metro Atlanta's fuel.

Some suppliers are rationing gasoline to retailers, so some stations may already be near empty.

With supplies uncertain, oil companies and larger wholesalers are ratcheting up prices, partly to slow demand. Some local wholesalers already are paying 65 to 80 cents per gallon more than they paid three days ago. That kind of price increase will hit the pumps within a few days.


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I just filled up with gas at $2.69 a gallon. It was $2.49 before Katrina. I passed a couple stations that jacked the price up to $3.25 for regular already. The gas scare is taking ahold already I guess. I won't drive much until the gas supply to Atlanta is fixed. If I just drive home to work I probably can get by with not having to fill up for 3 to 4 weeks if need be. Hopefully the supply would be fixed by then.

There were some people talking in my office building that 87 octane in Charlotte just hit $2.99 in some places.

I purposely filled up yesterday even though I still had 3/4 a tank left. It was $2.69 when I filled up yesterday and it was still at that this morning when I drove by that gas station. I wonder what it will be when I drive past it on my way home today.

I really feel bad for a friend of mine who's driving up from Orlando this weekend!!!

ETA:
I'll bet the gas shortage problem Atlanta is facing is probably the same in most of the Southeast. I'd imagine that most of the Southeast gets their gas/oil from the New Orleans pipelines.

I was just out at lunch in Charlotte and saw gas for the premium for $2.99 at quite a few places. :(

I filled up for $2.36 unleaded in Gaffney on Sunday.

This should hopefully help....

http://www.nytimes.com/2005/08/31/na...gewanted=print
--------------------------------------------------------------------------------
The New York Times
August 31, 2005
U.S. Decision to Release Oil Sends Prices Below $70
By VIKAS BAJAJ

The Energy Department said this morning that it would release oil from the nation's Strategic Petroleum Reserve to keep refineries supplied, prompting a drop in crude oil prices, the first decrease since Hurricane Katrina slammed ashore on Monday and severely disrupted the energy infrastructure along the gulf.

Energy secretary, Samuel Bodman, said the decision to release the crude oil was made Tuesday night after an oil refiner asked to borrow from the 700-million barrel reserve. The government did not disclose the name of the company that made the request or say how much oil it would release.

The price for crude oil for October delivery on the New York Mercantile Exchange was down 41 cents a barrel, to $69.40.

"The department continues to review other requests as they come in," Mr. Bodman said in a statement. "This administration has been clear that SPR is a national asset that can be used in times of supply disruption, like a natural disaster."

The announcement came as President Bush returned to Washington today, two days ahead of schedule, to manage the Federal response to the storm, amid expectations that he would try to visit the devastated regions in the next few days.

The hurricane has shut down the vast majority of oil and natural gas production in the gulf and severely hampered refineries all along the coast. Energy analysts and local officials have said flooding and the lack of power will make it difficult for the industry to resume regular operations for a week to 10 days at the very least.

Energy analysts said that while releasing oil from the reserve would help, it may do little to increase the supply of gasoline in the short run because it would take refiners at least another week and some even longer to start processing crude oil again. The government has said at least nine refineries in the gulf coast have been completely shut down and several others have reduced their production.

"All of the crude in the world does not turn the crude into product, it still has to be refined," said Thomas Bentz, an energy analyst at BNP Paribas in New York. "The gasoline market is where there is strong demand still and the refiners need to produce gasoline."

Wholesale gasoline prices, which climbed for the third straight day, were up 17.55 cents a gallon, to $2.650. Since the hurricane came ashore, prices have risen more than 37.5 percent. The national retail average gasoline price was $2.619 a gallon today, up from $2.604 on Tuesday and $2.284 a month ago, according to the American Automobile Association.

The increase in gas prices comes less than a week before the three-day Labor Day weekend when many Americans take their last summer road trips and vacations before the end of the summer.

Highlighting the challenges refiners face, Valero Energy said Tuesday evening that a small crew was working to bail water out of its St. Charles refinery about 25 miles west of downtown New Orleans. The facility still does not have power and the company has not been able to get employees to the site, because officials are discouraging people from returning to hurricane-affected areas. Before the refinery shut down, it processed 185,000 barrels of oil a day.

The lack of power could also hamper or delay the release of oil from the oil reserve. Speaking on CNN, Mr. Bodman said there were two major pipelines that can deliver oil to the refiners, but that both still lacked power. "We are now working with both companies," he said, "to get these lines up and functioning."

Releasing oil from the reserve is a "good first step," because it tells investors and the market that the government is available to help ease energy constraints, said Lawrence Goldstein, president of the Petroleum Industry Research Foundation. "It's probably more psychological than physical but it's an important step. It breaks down the mindset that you are on your own."

Until today, the Bush administration has been reluctant to use the reserve, lest it appear to be acting politically. The last time officials released oil was after Hurricane Ivan destroyed underwater oil and gas pipelines and other infrastructure last year, but they have resisted calls from Democrats and others to release oil to bring down prices.

"Bodman redefined for the administration, at least for this time and maybe it's a unique situation, that this is exactly why we have the reserve," Mr. Goldstein said.

A loan from the petroleum reserve must start as a request from an energy company to the government. Companies agree to replace all the oil they take from the reserve at a later date.

Mr. Goldstein said consumers were not likely to feel a benefit from the release right away, because demand for gasoline was so strong and refining capacity was already stretched. Also, pipelines that bring refined gasoline from the Gulf Coast area to the Northeast are not operating because powerfailures.

"There is going to be pain long after because we were already short," he said. "This pushed a very, very tight situation over the line. While we can ameliorate pain, we cannot eliminate it."

I live across the street from a bp, and the gas is currently $2.48. Needless to say, it has been VERY busy...

For those that live in Atlanta, that station is the one on Cobb Parkway a block from Cumberland Blvd.

I filled up for $2.34 yesterday. It was $2.52 when I left for work at 3AM this morning, and on the way home (around 1 PM) it was $2.81. Oy.

Experts: $4 a gallon gas coming soon

:(

Our governor (GA) just got on the radio and said cut the crap everybody, most of our gas comes throught the Port of Savannah and has nothing to do with the Gulf. But the lines, coming through town, were backed waayyy up and the price went up 40 cents a gallon while I was in line.

Lines are now about 1/2 mile long at some stations. Some stations are now out of gas. On the radio they said there have been 2 shootings at gas stations across Atlanta.

Oooh, that's right by my house. Thanks for the info!

ETA:

I'm never going to get to leave work today. I'm looking out my office window and I can see that 14th street, Peachtree, Spring St and West Peachtree are completely backed up because everyone is trying to get into the gas station on Williams & 14th St. And gas is always expensive at that station- shortage or no shortage!

This is really bad....

Oh damn. :( They have closed some stations here in Charlotte as well because there is no gas.