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Front Page September 26, 2008  RSS feed

GAS PANGS

Officials confident situation will stabilize soon
By TIM GULLA Ledger Staff Writer tim@gaffneyledger

Murphy USA on West Floyd Baker Boulevard was one of many stations in Cherokee County and the Upstate experiencing ongoing gasoline supply problems. The station ran out of gas about 11 a.m. Wednesday and wasn't back in the gas business until midday Thursday. Oil industry representatives say supply problems are temporary but could last a few more days as production ramps back up on the Gulf coast. Murphy USA on West Floyd Baker Boulevard was one of many stations in Cherokee County and the Upstate experiencing ongoing gasoline supply problems. The station ran out of gas about 11 a.m. Wednesday and wasn't back in the gas business until midday Thursday. Oil industry representatives say supply problems are temporary but could last a few more days as production ramps back up on the Gulf coast. It seems that plastic bags were almost as in demand as gasoline in Cherokee County and much of the Upstate region in the past week as gas stations routinely found themselves with empty tanks and long waits for new shipments.

Gas pump nozzles covered with plastic bags — the seemingly universal symbol for no gas — were just as common as uncovered nozzles during a drive up and down West Floyd Baker Boulevard.

While the situation has been leading to consumer angst and gas hunting to find operational pumps, industry experts believe it's only a temporary blip that should correct itself soon.

Still, officials concede the situation is frustrating.

"Things are very tight statewide," said Michael Fields, executive director of the South Carolina Petroleum Marketers Association, a trade group that represents gas retailers, gas station suppliers and gas wholesalers in South Carolina. "It's not just an Upstate problem, it's all over."

The rolling outages affecting gas stations in the region continue to stem from hurricanes Gustav and Ike and shuttered gas production in the Gulf of Mexico. The effects of those closures have been felt across the entire Eastern seaboard, but have been particularly noticeable here since a major pipeline from the Gulf runs through the Upstate.

"Gustav tightened our supply a little bit," Fields said. "It wasn't widely felt but it was clearly an underlying issue and concern in our industry. When Ike shut down 17 refineries, which accounted for 27 percent of the U.S. refining capacity, that was a significant blow."

Hurricane damage was not as bad as anticipated. Even under the best-case scenario it was going to take at least seven to 10 days for gas to start flowing again once those refineries went back into service. And five of those refineries still were out of service as of Thursday, according to the U.S. Department of Energy.

Fields assured the situation will improve as more gas starts to flow out of the Gulf but cautioned the short term may continue to feel like a roller coaster ride with ups and downs.

Denise McCourt, industry relations director for the American Petroleum Institute, a national trade group for petroleum companies in Washington, D.C., said the API had received reports of major spot shortages throughout the Southeast but said a major effort was underway to bring new supplies of gasoline into the Southeast region, such as by importing gasoline from Europe.

"But the reality is it takes some time," she said.

A run on the pumps that began two weeks ago exacerbated supply problems by depleting existing stockpiles.

"The systems are not designed for everyone to show up and buy gas on a single day," McCourt said. "Here we have a situation made more difficult by the fact the pipeline that brings the product up from the Gulf is also having the same restraints as the refineries because it's not at full capacity. Consequently, supplies are not coming in as quickly as they would have prior to Ike."