Running on Empty
ST Frequency
Across the Southeast, motorists have been running on fumes. The gas shortage afflicting the region is finally showing signs of relief after three long weeks, though supplies will likely remain tight through mid-October.
Early last month, the double wallop of Hurricanes Gustav and Ike hammered the Gulf Coast, shutting down operations across a network of Louisiana and Texas oil refineries and crimping critical fuel pipelines. Hardest hit by the supply interruptions are the metro areas of Atlanta and Charlotte, where spotty availability and hour-long gas lines have plagued city commuters.
In scenes reminiscent of the 1970s, queues of idling vehicles stretched vast distances for a chance to fuel up. Prices for a gallon of regular spiked to as much as $4.69 in some locations, with Atlantans continuing to pay the most for gas in the lower forty-eight states. At the height of the shortage, local 911 centers were overwhelmed with calls from frantic drivers hunting for freshly stocked stations. Reports of fights erupting at the pumps and cars tailing tankers on the freeways highlight a fuel-starved anxiety that mounted as the crisis wore on.
“We’re beyond panic,” remarked Tex Pitfield, president of Atlanta-based gas distributor Saraguay Petroleum. “We’re into desperation.”
The painful duration of the gas shortfalls has taken many by surprise, prompting serious backpedaling from government officials. In a September 25th statement, Georgia Governor Sonny Perdue downplayed the situation, insisting there is “ample fuel in the city.” He suggested people stay calm, adding that the problems were partly “self-induced” by panicky drivers rushing out to top up their tanks and quickly draining off new shipments.
As the shortages continue, however, Perdue is facing stiff criticism for what some view as his slack response to the lingering crisis. (The governor met with similar outcries last summer, when a creeping drought threatened the capital city’s water supply and grabbed national headlines.) In an attempt last Monday to assuage public concerns, Perdue made an emergency plea for President Bush to release unrefined crude oil from the nation’s Strategic Petroleum Reserve – a hollow bit of political grandstanding, unlikely to fill Atlanta’s empty tanks in the near term. While the situation appears to have improved recently, as refineries in the Gulf come back online and ramp up production, experts predict another week or more of reduced supply to the region, to the dismay of beleaguered drivers.
A host of factors have been named as contributing to the fuel scarcity. Most directly, an absence of refining plants in the Southeast puts the region critically dependent on gasoline piped in from the Gulf Coast. Because other parts of the U.S. secure their gas from a broader range of sources, the diminished output from the Gulf had little impact elsewhere. Supply issues are further complicated by some 200 “boutique” fuel blends tailored to local air-quality standards – a nearly impossible arrangement to maintain during a crisis. Panic buying and stockpiling of gas also played a big role in the rapid depletion of what little gas became available.
Still, many in the industry are at a loss to explain the severity of the current predicament, which has eclipsed the milder gas disruptions from 2005’s devastating twin storms, Hurricanes Katrina and Rita.
“This is significantly worse than Katrina, but we haven't quite been able to … figure out how or why," Pitfield told The Christian Science Monitor. “We can't get anywhere near the amount of gas to satisfy the demand.”
Some energy analysts see the drama in Atlanta and Charlotte as troubling evidence of a national fuel supply grown dangerously overstretched. In a posting at the energy futures blog The Oil Drum, a trend among oil refineries towards keeping less inventory is called out as a fragile link in the distribution system. With profit margins hemmed in over the past few years by skyrocketing crude prices and relatively lower retail costs, refineries are storing less surplus gas to save on expenses. When an unexpected event like a hurricane temporarily shutters operations, there’s now a reduced emergency inventory to float consumers until the system comes back online, resulting in chaos at the pumps.
Such severe disruptions in the fuel supply are highly unusual, raising new concerns about a system presumed to be stable and secure. Arising over a two-week stretch that also saw the near collapse of the global financial markets, the dramatic gas shortages may point to a broader systemic breakdown underway.
Interviewed by The Oil Drum, Red Cavaney, CEO and President of the American Petroleum Institute, warned that the credit freeze currently stymieing Wall Street could have “a big impact” on smaller players in the oil industry, who rely on borrowed capital to cover operation costs. With profit margins under increasing pressure from high crude prices, the added squeeze of reduced credit lines will force refineries and distributors further out along the razor’s edge.
“Most people would like to think that the oil and gas business is unaffected by today's credit problems,” concludes The Oil Drum. “This is clearly not the case. If we cannot fix the US credit problems (and it is not clear to me that we can), these … are likely to spill over into things we take for granted, like gasoline production and inventories.”
U.S. energy secretary Sam Bodman echoed these concerns in a Reuters report on the sluggish pace of repairs at Gulf refineries. The deepening financial crisis, he noted, could inhibit oil industry growth projects critical to meeting increasing fuel demands. If the markets do not soon turn around, “these long-term projects – and these are the most difficult to finance – long term projects are at risk I think,” Bodman said.
Whatever the underlying cause, the national gas supply is in frighteningly bad shape. A recent Fortune article on the Southeastern crisis notes that the Gulf refinery shutdowns plunged U.S. fuel inventories to levels not seen since August of 1967, when daily oil demand was nearly half what it is today.
“Liquidity must be returned soon to this market,” writes Fortune’s Brian O’Keefe, “or we could be facing a crippling run on the gasoline bank.
This is a truly astounding situation – a paradoxical sign of an industry in dire straits, despite raking in record profits. If it remains contentious to say that we have hit Peak Oil, perhaps we can agree that we’re witnessing Peak Greed in the petroleum business. After smashing the $100-per-barrel ceiling at the start of the year, the price of crude soared to an all-time high of $147.20 per barrel in July. And while surplus capacity has dropped to disastrously low levels, the bubble of speculative oil trade has grown grotesquely bloated with Wall Street graft, perpetrated by the same banker-buccaneers embroiled in the ongoing mortgage debacle.
Despite its recent slump following the convulsions of the financial markets, crude oil’s skyward trajectory is not likely to reverse course for long, some analysts say. In “Here Comes $500 Oil,” a high-profile feature from O’Keefe in last month’s Fortune, energy investment banker and peak-oil proponent Matt Simmons is quoted offering a bullish, albeit bleak, forecast to an assembly of oilmen:
“There’s no end in sight to higher oil prices, unless the world economy absolutely collapses,” he warns.
It remains be to be seen whether he’s right and the price of crude will continue its steady climb – or the global economy, its plunging ruin. But in light of the past fortnight’s market bloodbaths and unprecedented government bailouts, Simmons' reputation for prescience demands pause.
Looking to the future of a credit-pinched, fuel-strapped America, O’Keefe sums up the situation:
“If you think Americans are outraged about Wall Street, wait until their Main Street grocery store doesn't get the bread and milk delivery for a week or two.”
As plentiful gas returns to the sprawling suburbs of Charlotte and Atlanta, the wake-up call about our dwindling fuel supply threatens to fade from attention. But the inventory problems aren’t going away so easily – and next time, the effects could be far more painful.
Images by abbyladybug and Mark Strozier used under Creative Commons license.
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I'm in the middle of this ...
-
Living from wild plant food sources (and entheogens) - a truly archaic revival.
Permaculture is the moulding of the natural enviroment to provide food, this could be paradise...
The solution?
We are flooded with news stories about the oil crisis, but nobody is proposing a real solution, let alone question the root cause of the problem! This is borderline infuriating to me, considering that a huge part of the long-term solution is right under our noses. Yet, nobody mentions this solution because nobody wants to admit that tearing down the streetcar systems and building sprawling suburbs was the wrong thing to do 50 years ago. This is understandable, considering that it means admitting that the "American Dream" is not only unsustainable, but threatening to our very survival.
Why is nobody piping up and asking:<br><br>
"why must i drive 2 miles to buy a loaf of bread?" or,<br><br>
"why can't i walk on the streets in my neigborhood?" or,<br><br>
"why is owning a car, being licensed, paying for gas, and paying for insurance a necessity?" or more simply,<br><br>
"what's wrong with this picture?"
before the 1950s, most people walked or took public transportation. Before the turn of the century, everybody walked. After WWII, oil, automotive, and tire companies (OATs) bought up most of the rail and streetcar lines in the country and tore them apart. Today, many 3rd world countries have more comprehensive rail networks than we do. Have you been to an Amtrak station outside of the NE corridor lately? It's truly tragic. The stations are deteriorating, neglected, and the personnel often don't have the equipment to do their jobs safely (i recently took Amtrak from Birmingham, AL to NYC. When I was boarding in Birmingham, the station attendants - who, all two of them, performed every duty in the station - were pulling luggage on 100 year-old luggage carts BY HAND. When the train entered the DC suburbs in Northern Virginia, the same pull-cart being used in Alabama was restored and on display with a placard at a much nicer commuter station. Also, the trip took 24 hours. It could have taken eight, had our government been investing in high-speed rail like the rest of the developed world has been for the past 10 years). Bus systems are a joke and a way for OATs to profit off of public transportation and maintain the infrastructure that supports their business: cities developed around roads and highways instead of pedestrians. Local and regional rail transit is almost non-existent outside of the NE corridor.
Rail transit - national, regional, and local - is the criminally neglected stepchild of the US government. Why? Rail transit not only threatens the profits of OATs, but it also causes cities to develop differently: into denser, walkable, transit-oriented neighborhoods where big-box stores and sprawling monoculture developments cannot thrive, let alone be built.
Why do people enjoy visiting Europe so much? Because their towns and cities are beautiful. Why are their towns and cities beautiful? The buildings are beautiful, the shops are beautiful, the parks are beautiful. But the reason those buildings exist is because the towns and cities are designed in such a way that all those things can work together and create a beautiful cityscape, and also one you can walk around.
Fortunately, there are people who have been thinking about this, and they call themselves the New Urbanists. They want to change the way cities in this country are built back to the way they used to be - a way that served humanity - virtually unchanged - for thousands of years. Oil consumption will be drastically reduced not only by elimination of the need for automobiles, but also in many residual ways, large and small.
This idea's time has nearly come. Unfortunately, the economic situation is not in a good place to finance national infrastructure re-development. That's where some clever planning and salvaging of what will be uninhabitable areas comes in. There is a lot of retrofitting and policy changing to be done, and it would be best done on the local level at this point. It's possible, and it's going to take a while, but it's best to sow the seeds now so it's not as hard down the road, when the root cause of this crisis finally enters public awareness.
Anyway, that's my rant. If you couldn't tell, I'm really into this stuff.
Problems and solutions
Hi pinkylifter,
Thanks for your comment here.
I hope I didn't raise your ire by focusing on the problem side of things with this article. You are right on all counts: the root cause of our dependence on oil is a half-century of auto-centered urban and suburban development. It's ugly, it's inefficient – and it's highly profitable for the OAT sector.
Unfortunately, it's also not going away without a fight – or a crisis, as it were. James Kunstler calls the post-oil era "the Long Emergency," and I think this is an apt description of the scenario we face when the roots of our folly are fully unearthed. The development models of New Urbanism will arise out of necessity, but only after suburbia withers and dies a rather unpleasant death. The gas shortages here in Atlanta, where I live, painted that picture clearly, as commuters traveling vast distances between home and work felt true panic at the prospect of being stranded or immobilized. As I mention, a more serious fuel crisis would be far more disruptive and chaotic, with food deliveries and public utilities interrupted.
I think the model of Transition Towns coming up in the UK are crucial for the future of urban living. These are initiatives begun within communities to actively prepare for the knock-on effects of Peak Oil, making arrangements to live more simply and locally. The New Urbanist techniques of salvaging and retro-fitting existing landscapes and infrastructure are surely the future of city planning, as I see it.
Check out this Reality Sandwich article on the Transition Town movement.
...
i hadn't heard about the transition towns - that's pretty amazing. Europe is setting another example that we would be wise to follow now. thanks for your reply!
New Urbanists theory is cool, but...
Propaganda Anonymous
Hola pinky lifter,
I like most of what I read about New Urbanist design.
I would like to see most of what I've read implemented.
My one, albeit small, gripe with some New Urbanist thought is the view towards 'Broken Windows.'
The 'Broken Windows' theory was one that stated that wherever there is Graffiti in an urban environment, one is likely to find many broken windows, and hence more crime and destitution.
This 'theory' was a rallying cry for many 'culture warriors' in the 1980s to prove that basically young urban kids who did graffiti sucked and hence law enforcement needed to institute 'anti-gang' policies that lead to a huge increase in kids being arrested and messed with by the cops cause they were just hanging out.
At the end of the day the 'Broken Windows' theory has received much evidence to show that it doesn't add up. It lacks veracity.
I've read at least one book put out by New Urbanist enthusiasts that substantiate 'Broken Windows' and hence look down at the ART of graffiti.
Thus far tho, I agree with you and most New Urbanist thought. Just leave room for the graf, man.
You guys should watch the
yes
You can get the book also....
Dont let this story get buried
Hey ST,
Thanks for this post. With the bailout and election play-by-play taking center stage in the US media, an important event harbinger such as this gets conveniently pushed aside. It's another example of how we have to remain awake and aware not just of what is being revealed but also what is being hidden by the media.
One of the things that has become very clear in the last few weeks is the necessity of a nation's citizens to BELIEVE in that nation. It calls attention to the fact that reality and everything in it is co-authored by our intentionality: a big reason the US is such a mighty super hero is because it believes itself to be. Once that belief gets shaken, it spreads doubt like wildfire, effecting everything from the market to reproduction rates.
It's not about doom and gloom but about change. Change has come in ways that one can see and feel--my brother lives in NC and wasn't able to buy gas yesterday but also reported that in his canvassing efforts to get folks in poor neighborhoods registered to vote, he heard again and again the answer, "I'm already registered." Regardless of what you think of who's running or the system as a whole, the fact that there are people who have never felt like any of this mattered to them at all who are going to vote for the first time. Not only that, but NC might actually vote Democrat for the first time in generations!
I can't help but feel psyched!
peace,
jp
http://twitter.com/true
the lesser of two weebles...
does anybody really have any idea
how humankind can rid itself of of this snake oil skin, it sure is obvious that its time it is sloughed off this skin that is screaming to be removed with its crumbling roads and freeways to nowhere.With its movies that show us how messed up we are, its sound bite reality, its toxic mindset, that would drug us and drag us to dead end lives and no jobs, but to send youth off to die in wars that perpetuate the reason to keep the machine rolling, so a few bloated toads can gloat.So we can sit in front of machines that are made of toxic things and go into landfills that are useless in the throw away civilization.
And if i don't write like i was trained in a university, it's because i spent a lot of my days walking around and sitting in libraries, and reading stuff at random, i did not drive to the drive-in chruch to praise the big filling station pump in the sky.I was always running on empty, with my foot on the little peddle that used ink for fuel.
Shock Testing
stock up on rice
could just get a spoon to eat monkey brains...
human brains in a can
meant that...
zo
Thanks ST
Propaganda Anonymous
Thanks for this man.
When I spoke a friend who lives down in ATL a few weeks ago and he told me him and his roommate were driving around, but couldn't find any gas, I thought he was just messing with me.
I'm not a big regularly scheduled tv guy, but I've seen nothing on the news about this. Nor have I heard anything on WBAI.
Yours is the first actual piece of journalism I've seen on this occurrence.
Shock Testing or not, this does indeed seem like further motivation to get with the groove. I am def gon be looking more into the Transition Town model. And get crackin.
Thnx again ST