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How Much Will Gustav and Ike Affect Gas Supplies? An Update.
Posted by Gail the Actuary on September 22, 2008 - 4:20pm
Topic: Supply/Production
Tags: diesel, gasoline, hurricane gustav, hurricane ike, hurricane katrina, jet fuel, original [list all tags]
Shortly after Hurricane Ike hit, I wrote an article called Implications of a Ten-Day Refinery Outage. It is a few days later, and we know a little more. The purpose of this article is to give an update on the situation.
Based on what I am seeing now, we are likely to see significant gasoline outages in the next few weeks. These may not be as long-lasting as those with Katrina, but they may temporarily be more severe, at least in some parts of the country. Diesel may or may not be a problem. We are an exporter of diesel, so can theoretically reduce exports if need be. Also distillate (used for diesel) supplies are currently at a more adequate level than are gasoline supplies. Jet fuel stocks seem to be at a relatively adequate level, so shortages may not be a problem.
As one can see from Figure 1, EIA weekly gasoline stocks are diving, on a path to 180 million barrels of gasoline or less, in the next week. Weekly gasoline supplies when Katrina hit in 2005 declined, but not nearly to the extent we are seeing today.
Refinery Impacts
The DOE provides information with respect to refinery outages. After examining these reports more closely, I realized that there are really three categories of refinery problems we should be concerned about (I only considered two of these categories in my earlier analysis.):
(1) Shut Down = 100% off line
(2) Starting Up = This can continue for several days. I have estimated that refinery capacity listed as "starting up" is 80% off line.
(3) Reduced Runs = This can occur either after starting up or when crude inputs are not available. As in my earlier analysis, I have estimated that production is one-third off line.
I also discovered that by adding together refineries, it is possible to look at state subtotals. This is helpful for seeing how quickly production is getting back online in Louisiana where production was primarily affected by Hurricane Gustav. A graph of refinery shortfalls shows that only now, 19 days later, is production getting back to close to normal.
A graph of Texas refinery shortfalls shows that Hurricane Gustav (September 1) had relatively impact. Since Hurricane Ike hit, refinery availability has been reduced by more than 3 million barrels a day.
If the pattern in Louisiana holds in Texas, it may take as much as 20 days after Hurricane Ike before all of the production is back on line. It will certainly be at least 10 days. This would put full production at something between September 23 and October 3. Pipeline delays of up to 18 days could delay full distribution of petroleum products until something between the first and third week in October.
Amount of Refinery Input Shortfall
How much of a shortfall have we been seeing to date? Suppose we compare the amount of crude oil used as refinery inputs in June, July, and August, with the amount of crude oil used as inputs during the week ended September 5 and the week ended September 12 (both after Hurricane Gustav, before Hurricane Ike). The calculation would indicate a shortfall in crude processed of 1.7 million the week of September 5, and 2.0 million the week of September 12.
(This calculation is based on the following: During the months of June, July and August, crude oil used as a refinery input averaged 15.2 million barrels a day. During the weeks ended September 5 and September 12, crude oil used as a refinery input averaged 13.5 and 13.2 million barrels a day. Subtraction would suggest a shortfall of 1.7 million barrels the week of September 5, and 2.0 million barrels the week of September 12.)
In the future, as the impact of the Hurricane Ike shortfall feeds its way through they system, the shortfall of all products combined can be expected to be higher the weeks ended September 5 and 12--especially the weeks of September 19 and September 26, when the Texas refinery outages are added in. I would expect the shortfalls of crude inputs to be in the 2 to 3 million barrels a day range during these weeks, and possibly even into the beginning of October. These shortfalls will take a while to work their way through the system, so we are likely to continue to see shortages for a few weeks.
Figure 4 shows that in 2005, when Hurricane Katrina and Rita hit, refinery and blender net inputs dropped by about 1.7 million barrels as day between August and September, and then dropped another 300,000 barrels a day in October. This reflected the combination of Hurricane Katrina (August 29) and Hurricane Rita (September 24) Based on my calculations, the drop in refinery and blender inputs between August and September of 2008 is likely to be a little over 2 million barrels a day. (This assumes in the refinery capacity calculations shown in Figures 2 and 3, the refineries would not be operating at full capacity if open, and that some of the shortfall can be made up with refineries elsewhere.) This drop would be even greater than the Katrina decline, and would occur from a much lower base. Assuming there is not another major hurricane in late September or October, production should bounce back more quickly than with the Katrina-Rita combination.
Gasoline Shortfall
As can be seen from Figure 1, stocks of gasoline were at critically short levels by September 12, the last date shown in the gasoline stock report. Based the rate at which gasoline (and blending stocks) were dropping, gasoline supplies during the first two weeks of September were about 700,000 barrels a day short of keeping inventories at a constant level. The next two or three weeks are likely to have even higher shortfalls of gasoline -- more in the range of 1 million barrels a day. WIth the very low recent inventories, it is hard to see how there will not be shortages some places around the country.
How about Gasoline Imports
If we look at historical data, it becomes clear that we are already importing about as much gasoline as is available, and there is little room to ramp up imports.
In 2005, the US was able to increase imports by about 500,000 barrels a day in October. In 2008, we are already importing at a very high level. The reason we are able to import gasoline is because European countries tend to use diesel as fuel for their cars, and because of this, there is gasoline left over form the refining process. The amount that is left-over is not going to suddenly increase greatly, so it is unlikely that we could increase our imports of gasoline without drawing down the reserves of the exporting countries.
There was an article yesterday, US will not seek emergency supplies from IEA: DOE. The reasons given were that the rate of recovery from Hurricane Ike should be fairly good, and importing gasoline from Europe will take until October, given the time needed to transport fuel across the Atlantic. By that time, our supplies should be back up. If there really isn't likely to be much available, that adds a third (unstated) reason.
Evidence of Gasoline Shortfalls
A map published by Gasbuddy shows that gasoline prices are higher in the Southeast and in the central part of the country. Both of these are areas where pipelines are operating at reduced rates, or are partly shut down, according to recent DOE reports. The reason why the pipelines are operating at reduced rates is because there is not enough refined products available, because of refinery closures.
There have been reports of $5 gallon gasoline in Connecticut. One newspaper reports that 85% of Nashville gasoline stations are without gas now.
Diesel and Jet Fuel
Both of these started with better inventories, so may have a little ways to go before shortfalls. Also, with diesel (actually distillate, from which diesel is made), we are a net exporter. If we want more diesel, the easiest way would be to reduce our exports. (If we were to ask IEA for distillate imports while we were exporting it, they would probably laugh at us.)
At ASPO-USA Conference
I am leaving for the ASPO-USA conference shortly after writing this, so will not be able to comment as much as usual. Please forgive a few extra typos. I wanted to get this posted before I left.
Edit
There are a lot of issues that I might have mentioned, but didn't. One of the more important is the possibility that the pipeline system may be near minimum operating level, and that some sections will no longer function if the level gets too low. The areas that would seem to be most at risk are the ones at the ends or lines, or on small spur pipelines. If this should happen, residents in the areas affected areas might find themselves out of all types of refined products (including diesel and jet fuel), unless they had extra supply stored in local supply tanks. Additional supply could theoretically be trucked in, but we have a limited number of trucks for transporting fuel.
Colonial pipeline is one of the pipelines that has had difficulty with adequate supply. The supply begins in Texas/Louisiana. The areas I would expect to be most at risk are on the spur pipelines and farthest north.
Thanks for the work Gail, Have a good trip.
Indeed. Great job, as usual. Thanks Gail.
Yes thanks. In the TWIP Report data is displayed that is very clear about that the a crisis is about to hit the East and Southeast by looking at the regional data. It is the extremes that kill; you can drown in a river that is on average 2 inches deep.
On the right side you can see the plunging inventories in the East and Gulf regions. Note this started before the hurricanes.
The market is responding. The Houston price last week is a regional warning. Hopefully a regional crisis will create a national awareness.
And here we have evidence of government manipulation of the price of oil as I suggested last week (and was sumarily derided for):
MSN
Did the government force down oil prices/
The United States government successfully popped the commodities bubble and brought down oil prices just in time for the election season, according to the latest rumor spreading around Wall Street trading desks.
Market strategist Donald Coxe from Canada's BMO Capital Markets discussed this idea in a note to clients last week. In his words, Ben Bernanke and Hank Paulson, trapped between commodity-fueled inflation and a tumbling financial sector, took "the pressure off the heavily-levered banks by putting pressure on the heavily-levered speculators and hedge funds that were short the banks and the dollar, and long the commodities."
They accomplished this in July by announcing the U.S. Treasury would extend Fannie Mae and Freddie Mac a line of credit while holding open the possibility of equity purchases -- moving the government's implicit guarantee of the GSE freak shows firmly into the explicit column. Coxe dubs it the July 13th Commodity Massacre.
By releasing the news over the weekend, when Asian markets were opening and liquidity was limited, the impact on both trader psychology and price were maximized. Moreover, the announcement was accompanied by a crackdown on short selling of financial stocks and "false rumors" by the SEC, as well as a reclassification of commodity traders by the CTFC.
The high flying hedge funds had flown straight into the G-Man's trap.
More at the link
And its seems there is some potential for a new tropical storm to form again!
Ah, interesting.
The year 1985 had a double-double whammy on the Gulf Coast:
Round One
Danny: Landed in LA on 15 Aug, Cat-1 with maximum winds of 80-kt and min pressure of 987 mb. The hurricane strengthened up to the point of landfall on the sparsely-populated central coast. Peak storm surge to the east of the hurricane rached 5-8 feet in LA and 2-3 feet in AL and MS.
Elena: Landed near Biloxi, MS, on 02 Sep with maximum winds of 110-kt and a min pressure of about 953 mb. Like Danny, this hurricane continued strengthening even as it neared the coast. The storm surge, generally 3-6 feet, reached 6-10 feet at some locations to the east of the center.
Round Two
Juan: Landed near Morgan City, LA, on 29 Oct with maximum winds of 75-kt and a min pressure of 971 mb. Then, after looping over Lafayette (the second loop on a complex path), the weakening tropical cyclone moved back into the GOM in the vicinity of Vermilion Bay. Juan, reorganizing over the warm waters, headed east toward a FL landfall on 31 Oct, with maximum winds of about 75-80 kt. Juan's slow, loopy path kept the system in the northern GOM for about five days.
Kate: Landed near Mexico Beach, FL, on 21 Nov with maximum winds of 85-kt and a min pressure of 967 mb. Mainly due to the presence of cooler waters in the northern GOM, and increasing shear from an approaching midlatitude trough, Kate was on a weakening trend before landfall. Peak intensity had been 105-kt and 955 mb on 20 Nov. An encounter with Cuba on 19 Nov, where the eye largely went over land, had only a modest impact on this hurricane's strength, and, after moving into the GOM, the hurricane intensified at nearly 1 mb/hr over the next day. Storm surge reached 11 feet at Cape San Blas, FL.
--
Given Katrina+Rita in 2005 and Gustav+Ike in 2008, it seems like one hurricane can have a significant impact on energy infrastructure, but two in close temporal association can have an incredibly bad impact. I wonder if a "one hurricane in isolation" is the typical assumption for emergency planning and the hardening of critical networks such as the electricity grid? Two hurricanes striking in a similar vicinity within a month of each other is rare on the Gulf Coast, but not incredibly so, perhaps a once-a-decade event. A triple or quadruple attack over 2-3 months is more rare, but common enough to appear in the historical record.
-best,
Wolf
Yes, 1 is looking like it's about to form - Kyle would be his name I believe.
Did we already have a Josephine? Did I miss one? :)
Josephine was born and fizzled in mid-Atlantic without doing any harm while we were busy watching Ike.
One thing I'd like to say as we figure out our real MOL is in general we have and excess of service stations. I rarely pull up to a pump and have to wait at all.
At most one car is in front of me. But this excess of pumps does not necessarily translate into a large reserve in the gasoline at the station. And of course these same stations are filled from a few local supply terminals. So on one had having 80% of the stations out of gas simply means longer lines but on the other this means to depo supplying them is incapable of filling local storage. This means for mean to get gasoline initially I go from zero wait to say 10 cars in line. But if it cuts to say 90% I may face a 100 car line.
Lots of cool exponential cascades possible.
But whats far worse is we have the pavlov's dog in effect which is a insidious version of the tragedy of the commons.
http://en.wikipedia.org/wiki/Ivan_Pavlov
http://en.wikipedia.org/wiki/Tragedy_of_the_commons
The real underlying reason that gasoline inventories are low is because of lack of oil but a short term disruption is seen is the cause. Thus the dog i.e the US Consumer has now been trained to deal with inconvience and high prices to access a common good which was before readily accessible.
They see it is simply a slightly more complex maze to be traversed to reach the end goal. And more importantly the training is not broken.
This crossing of improper responses to stimuli with access to greener pastures any minute is a powerful phenomena.
It shows how we have no problem trading time ( waiting in line ) for rewards ( fuel).
And furthermore its considered temporary by all local players. They cannot be convinced from this point on that the commons is permanetly smaller
and no amount of waiting will result in more fuel later.
This is combination results in the formation of a cargo cult.
http://en.wikipedia.org/wiki/Cargo_cult
And the people begin to believe that if they just wait in line supplies will show up.
Thus the long term effects of peak oil coupled with the assumption of short term causes results in effectively group insanity.
I.e cargo cults caused by crossing pavlov's dog with the lack of commons.
Not yet. But wait until it becomes a daily, regular time budget problem. Then behaviour may change to more premanent "solutions" like car pooling.
"Not yet." Yeah.
I am actually impressed with the orderliness of my fellow man at the moment.
Here in Asheville, NC, most gas stations are closed. The few that are open have lines up to a mile long, and people are bringing spare gas cans.
It seems they're ok waiting for hours in line at the moment, but it is looking like we will have real and major shortfalls of supply, and I'm not so confident people are going to see the world as business-as-usual then as they seem to even now with the lines and hoarding.
I'm glad they can wait in long lines and not riot, but what about when they hit empty next time?
Great analogy Memmel.
This can be applied to many other areas of society.
The big glaring example would be economics. People are, for the most part, not too troubled about increasing expenses and stagnant or declining income because soon we will "hit bottom" and then things will improve and they will prosper. That’s what they have been trained to believe.
I forget where the term came from it says a lot;
Americans believe they are all just pre-rich.
WOW! are they in for a surprise.
Great insight! It helps me understand some of the responses I am seeing in people around me... this, of course, cannot end well for everything that postpones how long it take the mainstream to begin to adapt in any meaningful way the less resources (of any sort) are available for such a transition.
I have read that some of the major brands of service stations are trying to keep some stations open in each part of town. They do this be letting some go dry for a while, and fill up others. There isn't really enough gat to keep all the stations ope, but they can try to keep a rotating group of them open.
What is so odd about this whole scenario is that there is so much disparity between regions right now. I understand there are different major pipelines servicing different regions from different origination points, but is there really no way to balance things out between regions? Is it that difficult to take resources from the Midwest to help out the SE and NE? During this whole episode, KC, MO has seen unleaded prices briefly go up, but now prices are once again descending, currently under $3.40/gallon.
This is just conjecture on my part, but if we're at or below MOL, which posters well-versed in the industry have been warning about for some time on here, then the only way to keep any flow going at all is to cut off some delivery points. There's not enough to keep the pressure up in all the pipelines, so some must be shut off or at least down to keep most of the system operating. It appears from what has been said on here that just this is happening, and that the most vulnerable points are taking turns with little or no delivery, so the rest of the nation can have BAU. The alternative is shutting down the whole system until stocks are back above MOL. Don't think that's doable politically, nor sensible logistically.
Which makes me wonder if Georgia, the Carolinas and Tennessee are being made to suffer so that the poor dears in and around the Imperial Capital won't have to suffer any inconvenience?
It is not expedient for industry to maintain excessive inventory of gasoline, nor to always increase inventory.
The current situation is unfortunate and it will be necessary to rebuild stocks after refineries are brought back online. If demand will rise due to lower prices after refineries return to full production, we might see continued pressure on supply and danger of gasoline price increases.
I read an article that the U.S. was not going to ask the IEA for emergency gasoline supplies as they did during the Katrina gasoline crisis.
MOL's have been misunderstood. Gasoline pipelines were already shutdown due to lack of supply, yet other pipelines are flowing. You do not get a situation where the whole system crashes as long as some refineries are producing. If shortages will occur they are more likely to be local or regional. Trucking was used to distribute gasoline beyond the pipelines. Rails served fewer areas than trucking. If there will be shortages of rail cars and bottlenecks due to higher demand, they will try to use trucking more. Higher prices in some areas might cause more gasoline to flow to those areas. There are spare gasoline inventories in the world. If you have money people will sell to you. If you wait for a deep gasoline discount you might stand in line a long time and get nothing.
"It is not expedient for industry to maintain excessive inventory of gasoline...
It's more than just casual flippant worship of "expediency". It costs money to maintain storage tanks to hold inventories of a volatile and potentially dangerous fuel. With all the fuss about "gouging", who in their right mind is going to spend even a penny more than necessary???
The temporary shortages of gasoline can be dealt with very simply: Let the market set the price and consumers will get just the right amount of gasoline they need. If you let a market do its thing there will be no lines, no long waits, and no stations without gas to sell. It really isn't very difficult.
Retailers that do this face legal retaliation (gouging claims) as well as customer retaliation. I posit that most stations would rather leave the lights off than try to sell gas at $5 or $6 per gallon.
A consequence: those still selling at $3-4 will report gas sales "higher than normal", "double our usual sales volume" and the press will report this as a panic buying event. In truth, places like Nashville will be selling less gas overall due to the closed retailers. But, the panic meme will spread.
Prices here in the Raleigh NC area have dropped as of last night to near 3.82 a gallon. And people think its a bargain!! There are many stations just with regular, and a few are out of gasoline. I just ran by a mcdonalds and bojangles and there are 26 cars waiting at the drive thru windows!!! American drivers are just darn morons. One part of me says 5+ a gallon and then get the idiots off the roads except to go to work, but then I get real and say hey maybe we need to live differently.
By the way I am on empty and think I should get sme gasoline for work this week, gasoline line stink I remember the 70s!! Hours upon hours waiting for fuel just to get to college and work.
We as a country have learned nothing. Greedy stupid people. When I see a large SUV pull up with extra 5 gallon gas cans on the roof!! There was no hurricane here in NC this week.
I was a fuel & lubricants wholesaler during the Arab Oil Embargo and I know all about government stupidity, price controls, odd & even days and so on. Price gouging laws are the height of political nonsense. They create long lines, shortages, over consumption, and hoarding. Let the market do its job and all those things disappear. It is really not too difficult. There is a definite choice gas at the price before the storm that entails long lines, shortages, and often unavailable or business as usual at a higher price.
"Let the market do its job and all those things disappear."
great, let the market do its job and let all those sleazy mortgage holder and their insurers hold the bag, not the us treasury*.
* notice i did not say us taxpayer ? that is because this $700 billion bail out and the 100's of billions for the search for wmd are being financed by debt on top of more debt, putting the monkey on the back of our children and grandchildren. off monkey off off off, kill monkey kill kill kill monkey. time for our "leaders" to grow up and grow some b@lls.
lessee here, the debt is at over $9 trillion and if we add $700 billion to that, el'befuddleoso will probably have doubled the debt in just 8 yrs. great economy george, you are doing a heck of a job. weren't those tax cuts supposed to reduce the debt in the long run by juicing the economy ?
All that "simplicity" is utterly lost when Joe and Jane Sixpack, stumbling blindly in the far reaches of the impenetrable haze of their innate bewildered stupor, jiggle and waddle into the picture. Their time is absolutely worthless - any spare moments will be dissipated watching moronic rubbish on teevee anyhow - so they'd rather while it away in endless lines than pay a little more. Or at least that's what they've loudly, vociferously, and repeatedly told anyone who will listen, as well as everyone who won't. Naturally, politicians have pandered by enacting new foolish laws, as well as by reinvigorating enforcement of moribund old foolish laws.
The inherent irremediable problem with "democracy" is that Joe and Jane rule. It follows that if your time is worth something, there is no real solution to your problem unless you are rich enough, say, to install a reserve tank in your front lawn, as happened in the 1970s. After all, why should anyone exert extra effort, work overtime, rent extra trucks and hire drivers, etc., to work around supply issues, when their only "reward" will be to be publicly pilloried as evil greedy "gougers" by teevee airheads and addled campus Marxists presuming to bloviate on Joe and Jane's behalf - or even to be hauled into kangaroo court with their livelihood at the tender mercy of an entire jury of Joes and Janes?
And here is one of those Joes speaking for himself, comment #3 as of the time I looked (emphasis added):
Yes, indeed, thanks to those good citizens for holding the price and running out. So now you're near empty because you heeded those foolish official orders not to "panic", and something urgent has come up, maybe a family member in another town needs attention right away. Well, good luck, you've just been shafted by those good citizens who ensured that there would be no supplies to meet urgent needs. Gee, thanks again.
Idiots.
The public seems to be upset that the oil companies are profiting. Maybe the solution is a Scarcity Tax. The Scarcity Tax would be imposed when supplies were disrupted, and serve to discourage hoarding and maintain supplies for emergencies while putting money into the public coffers. The money could help deal with the emergency situation itself, and anything left over at the end of the year could be given back to taxpayers.
Of course, if folks got the idea that this was a good thing in general, the Scarcity Tax could just be made permanent.
In theory it might be a partial solution, though the country is probably too diverse for it to be enacted in a form that didn't see the funds diverted, in no time flat, into Bridges To Nowhere such as the two in Alaska. It might also be politically infeasible inasmuch as people expect free handouts during emergencies, and it might well still tend to punish efforts to bring in supplies. And alas, the problem is precisely that even with good planning (which we lack, the best we seem to manage is limited punitive planning such as requiring gas stations to purchase expensive equipment and then dumping on them furiously if they dare to recoup the cost), supplies tend to find ways to become less available at such times.
Of course maybe the real solution to this whole nexus of issues is just to nationalize the gasoline supply. Then the supply would be absurdly inadequate and of poor quality just as with the collapsing bridges, dysfunctional airways, shoddy levees, inadequate roads, uselessly unreliable mass transit, and many other things the government provides badly, but OTOH the AGW folks would be happier, and perhaps also the juvenile-minded campus Marxists and bloviating "reporters".
Bad idea-they need the taxpayers money for Wall Street-those guys have big appetites. Government screws everything up-just tax the sheeple and give the moolah directly to the club members. Damn those liberal treehuggers.
You got just such a scarcity tax with the SEC disallowing short-selling.
In the past couple weeks there have been a number of threads lamenting hoarding behavior toward gasoline. I would like to throw out an argument that hoarding gasoline by keeping ones tank full is not only reasonable personal behavior but represent the best societal outcome as well.
An argument is often made that if gas hoarding did not occur there would not be any shortages. While this may be true in many situations and perhaps even the Gustav/Ike induced events of the present, it is not a general truth. If a shortage is developing that will lead to an absence of gas for many drivers regardless of hoarding behavior, then the supposed rational behavior leaves oneself and ones family on the short end of the stick. This is your rational behavior?
Further, what is the difference between storing our supply of gasoline in gas tanks versus tanks in Texas/Oklahoma (ect.) or the local gas station. The initial answer is that storage in gas tanks creates spot shortages and drives prices up. What a tragedy, prices will be driven up and people will start conserving realizing gasoline has become more precious. This conservation will decrease the potential of a real shortage.
The alternative would seem to be continuing business as usual as if no possibility of future shortage exists. Yeah, perhaps individuals responsible enough to intentionally refrain from hoarding would also reduce consumption. I would imagine at this point in time that increased price is a more effective means of destroying demand. In my opinion, the upshot of not hoarding gasoline by topping off ones tank is limited to maintaining the illusion that everything is normal. Don’t worry, be happy.
I end by noting this does not refer to all gas hoarding situations; however, keeping ones tank full of gas seems to me personally and socially responsible.
I am not talking about hoarding by keping your tank filled, I usually always would fill up when I was just below 1/2 of the tank, I was just not thinking this week about my gas tank and wow my camry with that 18.5 gallon tank is on E not smart since I do need to drive a bit over the next wekk. But when I see people bringing extra gasoline cans as I saw last weekend here in an area that had sunny skies and no chance of bad weather , they were taking/buying as much gasoline as they could get their hands on. It is a free country, but come now, how about saving some for the other guy down the line. Yes raise the price, but how bout making fuel and storing it for a HURRICANE??http://www.cnn.com/2008/US/09/19/nashville.gas/index.html
Here is the CNN article of what happened in Naseville yesterday, Thank you the INTERNET the American rumor mill is in full swing!!
Hey,
I was not actually responding to your post. It was a general comment and so I put it under a new thread. At least the people of Nashville and in parts of my home state North Carolina now have some clue gasoline is precious. Time to use less. As you suggested, also time to increase planning for future shortages. Here is an article consistent with Gail's information above, in which the former CEO of Shell oil suggests gas rationing may be necessary this month:
http://www.washtimes.com/news/2008/sep/15/gas-rationing-needed-former-oi...
Well it's a better play than putting your money in the stock market. I store 50 gals, and a bunch of propane tanks. It means I can get to work no matter what. I recall a financial advisor linked here who said, buy food, inflation makes it a better deal than any stock you can buy. The return is much higher. I do that as well.
Sta-bil is your friend.
Match my stockpile against your 401k anyday.
Cheers
Don in Maine
Rita hit at the TX/LA border and the Houston refineries were restarting (by the DOE situation reports) 3 days later. Rita was a month after Katrina and allowed some room for preparation. Gasoline (as you mentioned) inventories were much higher in 2005 when Rita.
Basically, there is no comparison to be made between Ike and Rita. Ike was a direct hit on the Houston area and most of the refineries are still completely shut-in. The ones that are restarting will take much longer to reach full capacity for a myriad of reasons (lack of industrial gases, power outages, etc...).
Also, we don't know exactly what the reduction in refinery production was outside of the hurricane affected area. For example, the nation's fourth largest refinery in Gary, Indiana is fed by the Capline pipeline originating in Houston. One Illinois refinery is completely shut-down for maintenance. Etc, etc....
I'm in Huntsville,Al and I've been taking a less direct route home the last couple of days, to scope out the gas situation.
It looks to me, like a l