While lines were still long to fill up at gas stations across San Antonio, officials reported Tuesday that the oil and gas industry was working overtime to stabilize supplies after panic buying in the days following Hurricane Harvey disrupted the system.
Although many pumps were back in business Tuesday, the first workday of the week, the lines of cars remain longer than usual, and concerns about rising prices are not unfounded.
The Texas Food and Fuel Association stated that, in a span of about 36 to 48 hours last week, the region experienced 10 times the normal number of drivers buying gas. The frenzy placed an incredible strain on the state’s fuel distribution system and threw the demand-to-supply ratio off balance.
In terms of supply, things are slowly getting back to normal, said Jeff Lenard, vice president of strategic industry initiatives at the Association for Convenience and Fuel Retailing.
“At one point, more than 5 million barrels per day of refining capacity was offline,” Lenard said. “More than 3 million barrels per day is now back online, so that is great news. And indications are that there is no major damage at the other refineries that are still offline. It does take time to get the new supply to places that need it, but things are looking up.”
There are about 250 million registered vehicles in the U.S., so overall demand is about 1.6 gallons per car per day. The system is set up for cars, on average, to fill up with 10 gallons every 6 days, Lenard said. “If that demand gets out of whack, and everyone fills up at once, someone is short. Sometimes fuel outages create gas lines. This time, gas lines — fueled by social media — created outages.”
In San Antonio, current gas prices vary widely, but go as high as $2.59 a gallon for regular, according to gasbuddy.com. However, some stations had only premium fuel, which costs more per gallon, to offer customers.
AAA Texas reported that the current average here is $2.58 a gallon for regular, or 57 cents higher than the average price this time a year ago. The current national average is $2.64 a gallon.
That’s the highest recorded price for a gallon of unleaded gasoline so far this year, according to AAA Texas, and motorists may not have seen the full impact of Hurricane Harvey at the pump just yet.
Now there’s another hurricane in the forecast, with models suggesting the Category 5 storm will strike the East Coast in coming days.
“Hurricane Irma is definitely a complication,” Lenard said. “It likely won’t hit refining capacity but will affect demand and distribution. There are more than 20 million people in Florida and if there is a mandatory evacuation, that will increase demand at a time when the system is still stressed.”
Last Wednesday, in the days after Hurricane Harvey made landfall, the U.S. Department of Energy (DOE) reported that 10 Gulf Coast refineries were shut down. Six refineries were being assessed at that time, and two were operating at reduced rates.
In addition to refinery shutdowns, several major pipelines were idled or operated at reduced rates.
“The shutdowns do not indicate a shortage of gasoline supplies in the Gulf Coast region or across the country,” stated Jeanette Casselano, a AAA spokesperson. “These are preventative measures. Overall stocks in the Gulf are above average levels and will be available to drivers once power is restored and area roads are cleared.”
On Monday, Valero reported that facilities at Corpus Christi and Texas City were operating “at pre-hurricane rates.” Its Three Rivers refinery continued to ramp up operations, and Houston will increase output as the city dries out and transportation and logistics infrastructure becomes more available. Port Arthur was in the final stages of being assessed so it can resume operations.
Shell stated its workers were performing inspections at Perdido spar and testing its operating systems in order to restart operations there. Well operations have now restarted, read a statement, and “while there is no specific timeline established for restart of production, it will begin again after all inspections are complete and the pipelines and refineries are back on line to accept product.”
For drivers of electric cars, #fuelpocalypse2017 has been a non-issue. Yet only 540,000 electric cars – only .22% of total cars – are being driven on U.S. roads, according to a 2016 ChargePoint report.
Perhaps that will change. In June, Texas lawmakers revived the Texas Emissions Reduction Program, offering incentives for electric cars in the amount of a $2,500 rebate on the purchase of electric cars, on top of the federal tax credit of $7,500. Such vehicles can range in price from about $30,000 to $160,000.
Or perhaps San Antonio will embrace public transportation.
VIA Metropolitan Transit announced on Monday it was providing free bus and VIAtrans trips throughout its service area Tuesday to encourage motorists to try transit in light of gasoline shortages. At noon Tuesday, VIA said it could not determine whether its free service had impacted ridership numbers.
Even with the availability of VIA, Councilman Rey Saldaña (D4) pointed out in a Rivard Report commentary that current public transportation in San Antonio is not fully adequate for the city’s needs.
“We must turn our extreme frustration and our undoubtable apprehension from this past week into action,” he wrote. “We must think bigger than four wheels. We must think two wheels, six wheels, and even steel track.”
In the meantime, San Antonio drivers wait, and pay, at the pump. Frustrated at incidents of fuel hoarding, some have called for rationing restrictions – but that’s a solution that isn’t likely to help, Lenard said.
“It really would be difficult to put limits on amount purchased at stations,” he said. “It would be extremely difficult to manage and is inherently anti-consumer. I’m not sure that a retailer limiting supply would do well on social media as a result of that action.”
And it could make the situation worse, he said. People with gas containers might be motivated to go from station to station, creating longer lines and draining the supply even further.