Some areas of Texas see Harvey-related gas shortages

Motorists in Texas have been encountering increasing numbers of “No Gas” signs when they try to fill up, evidence of the battering Hurricane Harvey delivered to the Gulf Coast’s huge energy complex.

Industry experts say the shortages are likely to be sporadic and short-lived.

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“Motorists tend to overreact to situations like these and then make them even worse,” said Patrick DeHaan, senior petroleum analyst at GasBuddy, a smartphone app that provides drivers with information on gas prices and station locations. “I would advise that they only buy what gasoline they need, and to conserve where possible.”

Still, DeHaan and others said the precise duration and depth of the supply issues will depend on when the Gulf Coast refineries — which combined account for nearly a third of U.S. refining capacity — are operational again, and when the Houston Ship Channel reopens.

The bulk of retail gasoline dispensed at pumps in Austin, Texas, is refined by Flint Hills Resources in Corpus Christi and then transported by pipeline to a terminal off U.S. 290 east of Interstate 35. Two Corpus Christi plants operated by Flint Hills that supply the Austin market were taken out of service because of Harvey, and it’s unclear when they will be operating again.

The company “is in the process of doing startup” on the plants, said Andy Saenz, a Flint Hills spokesman. He declined to give additional details.

Meanwhile, the Colonial pipeline — which stretches from Houston to New Jersey and supplies much of the U.S. East Coast and South with fuel — was shut down Wednesday, contributing to gasoline price increases and fears of shortages in those regions. Colonial’s operator said Thursday that it expects the pipeline to be operational again Sunday.

Motiva also announced that it is shutting down its Port Arthur refinery — the largest in the country — because of flooding, although some other refineries have been reopening.

Jesus Azanza, a spokesman for the Texas Food and Fuel Association, said the Austin terminal for Flint Hills refineries has been running largely off reserves since the hurricane.

“Part of what is creating the strain on the fuel supply chain right now is the fact that a lot of fuel distributors are having to wait four, five (and) sometimes six hours at the terminal so that they can take (gas) to a local gas station,” said Azanza, whose organization represents an estimated 12,000 convenience stores, grocery stores and truck stops that sell gasoline.

“In some cases, they’ve waited and then found out it ran out,” in which case they’ve had to divert to terminals in Waco, Texas, or San Antonio, he said.

While Azanza’s organization has received notices of fuel outages from some of its Austin members, he said the situation appeared to be worse in the Dallas area, where reports of long lines and empty pumps were more widespread.

QuikTrip, an Oklahoma company that operates 135 convenience stores in the Dallas-Fort Worth metro area, opted Wednesday to begin letting about half of the stores run out of gasoline to retain the ability to serve customers strategically throughout the area.

“Unfortunately, until things get better, we are not going to be able to supply (all of) them,” QuikTrip spokesman Mike Thornbrugh said Thursday. “We knew, based upon everything that is going on, it simply would not have been feasible to keep every single station that we have full of gasoline.”

Thornbrugh said he’s optimistic the measures won’t need to be in place for long.

Azanza said consumers should keep in mind that the issue is mainly one of “a strain on fuel supply” rather than an actual shortage, and it will resolve itself when floodwaters recede and gasoline reserves become more easily accessible, and once more refineries are operational again.

Texas Railroad Commissioner Ryan Sitton echoed that sentiment in an interview streamed live over the internet Thursday. The Railroad Commission regulates the oil and gas industry, and Sitton said it has received numerous inquiries from Texans worried about a potential gasoline shortage.

“I don’t believe a week from now that this will be an issue,” Sitton said. “This is not going to be a long-term issue. As the pipelines get back in shape and people realize that this isn’t as big an issue as it feels like today, this (panic) is going to stem.”

Still, the sporadic shortages are coming on the eve of Labor Day weekend, traditionally a time when motorists take to the road and demand for gasoline is high.

David Holt, president of the Consumer Energy Alliance, said the holiday “is going to be a big challenge,” particularly if “everyone rushes out to fill up” their tanks.

The result could be “dire consequences and widespread shortages of gasoline” if that happens, he said.

Holt estimated that national average price for gasoline could climb by 10 cents to 25 cents a gallon over the next week, and average prices in Texas rise by 20 cents to 40 cents a gallon.

In the Austin metro area, the average price for regular unleaded gasoline was $2.23 a gallon Thursday, according to auto club AAA Texas, up from $2.19 a gallon Wednesday and $2.07 a gallon a month ago.

The average price climbed to $2.37 a gallon in Dallas on Thursday, up from $2.32 Wednesday and from $2.16 a month ago.

In Houston, AAA pegged the average price at $2.19 a gallon Thursday, compared with $2.17 Wednesday and $2.08 a month ago.

Daniel Armbruster, a spokesman for AAA in Texas and New Mexico, had some simple advice for motorists.

“Don’t panic,” he said. “Plan ahead (because) there are still many gas stations that do have gas available. What we’re seeing as far as gasoline goes is very typical after a major hurricane.”

Cox Media Group