Gas shortages spread to more states
More states in the southeast are facing major gasoline shortages and long lines at the pump as the Colonial Pipeline shutdown stretches into a fifth day.
On Wednesday afternoon, 65 percent of gas stations in North Carolina, 44 percent of stations in Virginia and 43 percent of stations in both Georgia and South Carolina were out of fuel, according to the gas price website GasBuddy.
Other states are reporting fewer shortfalls, with 16 percent of stations in Tennessee, 11 percent of stations in Florida and Maryland and 7 percent of stations in Alabama said they were dry.
Analysts say the shortages are largely caused by panic buying as people fear they may not be able to fill up their vehicles in the coming days.
“It’s surprising how quickly the situation has escalated or deteriorated into this,” Patrick De Haan, head of petroleum analysis at GasBuddy, told The Hill. “At this point, the hoarding has become the problem, it’s not the Colonial Pipeline.”
“The system’s just not built for this intense, short-lived, exceedingly rare amount of demand,” he said, noting that demand in five states was up by 40 percent by Monday.
Cities are bearing the brunt of the outages, De Haan said, with Atlanta and Raleigh among the hardest hit. Rural areas, meanwhile, have fared somewhat better.
Tom Kloza, global head of energy analysis at the Oil Price Information Service, said the overall chaos is reminiscent of when Americans were frantically buying toilet paper at the start of the coronavirus pandemic, creating widespread shortages as lockdowns were imposed.
“To me, this is like the toilet paper problem,” he said. “People observe the behavior and they feel it’s incumbent upon them to load up their tanks.”
The gas shortages are creating headaches for the Biden administration. Officials including Energy Secretary Jennifer Granholm, Environmental Protection Agency Administrator Michael Regan and Transportation Secretary Pete Buttigieg have faced questions about agency efforts to get things back to normal.
The Colonial Pipeline, which carries about 45 percent of fuel consumed on the East Coast, shut down last week following a ransomware attack. It’s still unclear when the pipeline will be back online, though the company has said it hopes to “substantially” resume operations by the end of the week.
President Biden said Monday that his administration would soon start a 100-day initiative focused on improving the cybersecurity of natural gas pipelines, water and other critical sectors. Some members of the Federal Energy Regulatory Commission called for mandatory security standards this week, and Homeland Security Secretary Alejandro Mayorkas told reporters Tuesday that the administration was discussing the idea of some further oversight.
Many Republicans have seized on the shortages to criticize Biden’s energy policies, including a decision to nix the Keystone XL pipeline, even though it would not have serviced the affected areas.
“We cannot continue to limit our pipeline system’s capacity, as was the case with the Keystone XL pipeline, or these types of incidents will only pose more severe consequences in the future,” Reps. Sam Graves (R-Mo.) and Rick Crawford (R-Ark.), members of the House Transportation and Infrastructure Committee, said in a joint statement.
As for the gas lines, it’s not clear when distribution on the East Coast will be back to normal, even if the pipeline is back up and running by the end of the week.
“I think that it’ll at least be annoying or inconvenient to find gasoline … into next week,” Kloza said. “But really, we’re waiting on Colonial.”
He said he thinks things will calm down once the company sends a strong signal that fuel is once again moving.
De Haan put a longer timeline on it, saying he thinks it will take “a few weeks probably at best” for the situation to return to normal.
Industry analysts have emphasized that there’s not a lack of supply, but rather an inability to transport it.
“This is not a gasoline shortage,” Susan Grissom, chief industry analyst for the American Fuel & Petrochemical Manufacturers, told reporters. “We have an abundant supply of fuel, refineries are running.”
In response to the pipeline shutdown, the federal government has loosened restrictions on hours for motor carriers and drivers and issued waivers lifting air quality rules in 12 states that dictate what type of gasoline can be sold in the summer.
Some industry leaders say more needs to be done, including a waiver of the Jones Act, which can add to shipping costs because it requires the use of American vessels to move products between U.S. ports.
“We know this action is being considered and we urge the president to move forward on issuing temporary waivers,” Grissom said.
In the meantime, industry representatives said a return to normalcy will depend on various factors like how effective the waivers are, whether panic buying subsides and if Colonial is fully operational in the next few days.
“I think all of those factors will answer the question as to when we’re back to normal,” said Frank Macchiarola, senior vice president of policy, economics and regulatory affairs at the American Petroleum Institute.
“We’re hopeful that the pipeline is operational soon and that some of the panic-buying retreats a bit and the actions that the administration has taken start to have some impact favorable to the market,” he said.