Rising prices, supply considered normal after recent events
Problem partly caused by panic, rumors of shortage cause consumers to rush to gas stations
Dahleen Glanton
Issue date: 9/29/08 Section: Money/Health
ROSWELL, Ga. (MCT) - Since Hurricane Ike struck the Texas Gulf Coast, "out of gas" signs have become common sights across the South. But the problem is not entirely caused by a reduction in gasoline, industry experts said. It is partly due to panic.
The storm hit two weeks ago, and major pipelines that transport gas from Texas to the rest of the country have operated at reduced capacity according to the Department of Energy. The department reported a 20 percent loss in U.S. refining capacity, resulting in the lowest supply since 1967.
Nowhere has the slowdown had such an impact as in the South. Barricades block the gas lanes at many stations, and frustrated drivers with their tanks almost empty, drive for miles looking for a station where the pumps are working.
In Nashville, gas at 85 percent of the stations dried up last weekend after a rumor of a shortage caused people to rush to top off their tanks. In suburban Atlanta, cars have followed gasoline trucks to the station. And at stations that do have gas, police and attendants have had to direct traffic that is sometimes a mile long.
Energy officials said the gas constraints could continue for the next few weeks as the refineries get back to full production. Meanwhile, Southerners will have difficulty filling their tanks.
In times of economic uncertainty - this one fueled by the mortgage crisis, the high costs of fuel and groceries and a massive financial bailout proposed by the government - fear can translate into panic at the gas stations, said Lars Perner, a marketing researcher at the University of Southern California's Marshall School of Business.
"People are uncertain about their future, and if the financial system can go wrong, consumers feel that anything, including the gas system, can go bad. All of that contributes to a sense of anxiety," he said.
Illinois has not had similar problems because the state gets much of its gas from five major refineries, including four in the state and one in Indiana, said David Sykuta, a spokesman for the Illinois Petroleum Institute. Gasoline prices, however, have remained slightly higher than the national average in Illinois and Chicago, according to the Automobile Association of America.
The storm hit two weeks ago, and major pipelines that transport gas from Texas to the rest of the country have operated at reduced capacity according to the Department of Energy. The department reported a 20 percent loss in U.S. refining capacity, resulting in the lowest supply since 1967.
Nowhere has the slowdown had such an impact as in the South. Barricades block the gas lanes at many stations, and frustrated drivers with their tanks almost empty, drive for miles looking for a station where the pumps are working.
In Nashville, gas at 85 percent of the stations dried up last weekend after a rumor of a shortage caused people to rush to top off their tanks. In suburban Atlanta, cars have followed gasoline trucks to the station. And at stations that do have gas, police and attendants have had to direct traffic that is sometimes a mile long.
Energy officials said the gas constraints could continue for the next few weeks as the refineries get back to full production. Meanwhile, Southerners will have difficulty filling their tanks.
In times of economic uncertainty - this one fueled by the mortgage crisis, the high costs of fuel and groceries and a massive financial bailout proposed by the government - fear can translate into panic at the gas stations, said Lars Perner, a marketing researcher at the University of Southern California's Marshall School of Business.
"People are uncertain about their future, and if the financial system can go wrong, consumers feel that anything, including the gas system, can go bad. All of that contributes to a sense of anxiety," he said.
Illinois has not had similar problems because the state gets much of its gas from five major refineries, including four in the state and one in Indiana, said David Sykuta, a spokesman for the Illinois Petroleum Institute. Gasoline prices, however, have remained slightly higher than the national average in Illinois and Chicago, according to the Automobile Association of America.
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asperger man
posted 11/03/08 @ 2:18 PM CST
GOOD GOD WE'RE ALL GONNA DIE!!!!!!!!!! AAAAAAAAAAAAAAAAAAAAAAAAAH!!!!!!!!!! VOTE RALPH NADER!!!
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