The Oil Drum | Looking Ahead - The Weekly Petroleum Inventory Reports

163 comments on Looking Ahead - The Weekly Petroleum Inventory Reports

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futureseeker on September 16, 2008 - 8:11pm

Where I live in Virginia, there are still stations without gasoline, and gas is $4 per gallon. Further south it is higher. I have heard almost nothing about this on the news, which is crazy, considering that our gas prices are higher than California's which normally has some of the most expensive gas in the country. It is amazing to me that the news organizations aren't covering the fact that a single minor hurricane was enough to shut down supplies to the southeastern united states. Clearly we do not have enough fuel to go around, and I can only imagine the dire implications of a true fuel shortage due to declining production rates in the Gulf and Middle East. If you want to see the near future of the United States, come down south.

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expat on September 17, 2008 - 12:30am

Yeah, Gustav wasn't really all that big of a deal.

Ike, however ....

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wisco on September 17, 2008 - 8:57am

There seems to be a tacit cap on price increases, perhaps fear of being charged of gouging, or desire to not face angry customers. Higher prices would temper demand and maybe prevent dry gas pumps, but perhaps its easier to just let the customers take the gas "off the shelf" until the shelf is bare and then turn out the lights until supply returns to normal. I wonder what will happen at the last few stations still pumping gas in these regions- will they finally break, or continue selling at around $4/gallon?

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Starship Trooper on September 17, 2008 - 11:20am

As a follow-up. I just talked with the BP/AMOCO station operator next to our offices. She told me that all 20 of their stations in the Raleigh area are out of gas (well, 800 gallons left in the bottom but she does not want to plug her filters) and that the terminals are also out (Selma and Greensboro). She does not know when they are going to be supplied again, though she estimates maybe in a week or so. As she noted, the pipelines are still down

As the shortages become more apparent maybe there will be more coverage on the news, but people are going to figure out if there is no gas pretty quickly.

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Nate Hagens on September 17, 2008 - 11:46am

And that has several dynamics:
1)less gas will be sold overall which is why futures prices are declining (i.e. the imports and expected restarts of refineries will offset c rrent demand.

however,
2)we could shift from just-in-time to just-in-case behaviour and people will keep some of that 180 mill barrels of gasoline storage in their own tanks instead of government/private tanks

3)it will result in less driving to malls, Chuck-e-Cheeses, etc.

4)on top of some likely bank runs this weekend, it's gonna make for some stressed out folks. Accessing rational neo-cortex may be increasingly be trumped by our reactionary synapses. Jekyll...meet Hyde... :-o

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jteehan on September 17, 2008 - 5:35pm

A million fewer barrels a day of usage is great no matter what the reasoning.

I just wish California would run out for a while so that I could ride my bike in peace.

My vehicles stay above 3/4s from here on out. That's two barrels of diesel and one barrel of gasoline off the system. Ironically, prices are falling out here. I'm happy to bike and take the train, but my wife has two artificial legs and unfortunately really needs the minivan to get around town. Although the Prius also has hand controls.

Thanks Nate for all your hard work. You guys really do the world a service.

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futureseeker on September 17, 2008 - 5:56pm

I guess it depends on the station, Exxon normally has gas no matter what, they are also the most expensive, Wilco (Hess) is also normally supplied.

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Starship Trooper on September 17, 2008 - 9:47am

We had some stations go as high as $5.49 per gallon (but they are facing possible price gouging charges if they can't back up their wholesale price increases.

It seems that the whole price issue has settled around $4.00-$4.10/gallon or the operators simply let their pumps run to "dry" to avoid getting stuck with inventory that they might have to sell at a loss.

I'm lucky, I can go another month on the tank of gas I have in my car, if I need to. Others don't have the same options I have.

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research24 on September 17, 2008 - 12:35pm

Demand didn't fall. The ability to buy gasoline did. We have gas stations here in Destin Florida that haven't had gas for six days now.

Be careful how you interpret data.

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wisco on September 17, 2008 - 12:43pm

I am baffled by what seems to be two conflicting realities: Google news search on "gasoline shortages" yields few actual reports of dry pumps, but the blogs have reports of stations here and there with no product (or stories like below about tank delivery drivers who are noticing major changes in the distribution system). Gas Buddy shows daily pump prices dropping Tuesday to Wednesday in markets like TN and AL, where the dry pump blog reports seem to come from. What gives? I feel like I need actual time-stamped photos of pumps without product to confirm that there is in fact a shortage of supply at the retail level. Anyone?

http://news.google.com/news?hl=en&q=gasoline%20shortages&um=1&ie=UTF-8&s...

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Pitt the Elder on September 17, 2008 - 1:03pm

I am baffled by what seems to be two conflicting realities: Google news search on "gasoline shortages" yields few actual reports of dry pumps, but the blogs have reports of stations here and there with no product

Keep in mind that there are tens of thousands of gas stations in the US, so hundreds could have no gas even while 99% of stations are fine. Moreover, most places have multiple stations from multiple companies, so there's little impact on the public - and hence less news interest - if it's only one station or one company's stations that's having trouble, as people would just gas up at other stations.

Personally, I don't see a dichotomy here; a simple explanation is that some stations are having trouble getting product, but vast majority aren't, so almost all of the public sees little or no effect, so it's not something that makes the news.

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wisco on September 17, 2008 - 2:10pm

Good points, but with empty shelves at even a small portion of stations, how can retail prices go down? What makes the stations with product, perhaps across the street from one without, so confident that the trucks will keep coming? Reports our of TX are 9-10 days of refining down at a minimum on top of already near-record low inventory, but AAA says "no worries" based on...?

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DIYer on September 18, 2008 - 8:26am

Be careful how you interpret data.

Like when the newsdroids assert that "people have become discouraged and stopped looking for work", when all that has happened is they've used up their few weeks of unemployment and have been kicked off the rolls.

... define "demand"; define "supply"; define "money" ...

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