Why Florida Ran Out Of Gas During The Hurricane

By , in Economy US World on .

The fuel shortage linked to the two recent hurricanes hindered evacuation and now recovery, underscoring our reliance on a fragile resource.

In Gainesville, about 45 percent of gas stations were running out of gas on the Wednesday before Irma’s arrival. In West Palm Beach, it was 50%. And the price of gasoline had increased by almost 30 cents on average, not counting the generalized price manipulation that struck Florida before the hurricane.

The exodus created widespread gasoline shortages in the days before the hurricane hit land, and most South Florida gas stations ran out of fuel Thursday. Unused and abandoned vehicles dotted the streets to the north. It was a situation that paralyzed many Floridians who wanted to evacuate, as I discovered when I called several residents who weighed their options. “It’s like you’re trapped,” said Adrienne Willensky of Pembroke Pines, who was terrified of trying to drive.

“They knew the hurricane was coming, but where was the reserve gasoline?” asked a West Palm Beach woman named Adrienne Beauchamp on the same day. “Why was not Florida better prepared?”

I brought your question and others to the fuel experts. Being a car-dependent state with a history of hurricanes, Florida had a week before Irma’s scourge to stock up on enough fuel so residents could escape in their cars-the preferred mode of evacuation. But that was not enough time and the reasons for this add to yet another dimension of the Sunny State’s growing vulnerability to climate change.

Too many hurricanes

The southern part of the Florida peninsula is a place famous for its precarious situation. One lesser known vulnerability that Hurricane Irma exposed is how difficult it can be to move fuel supplies quickly. Unlike states with more shared borders and transportation infrastructure, approximately 97 percent of refined fuels sold in Florida are shipped from the Gulf of Mexico. Much of it comes mostly from refineries off the Texas coast, which were destroyed a few weeks ago by the second most expensive storm in US history , Hurricane Harvey.

With Texas refineries unprotected because of Harvey, Florida fuel providers were already feeling the pressure before Irma’s path became apparent. In fact, the week before Labor Day, according to Jim Storey, director of business development at Georgia-based petroleum fuel distributor Mansfield, Florida was trucking its own supplies up there to help Texas. But as the predictions about Irma were defined, the flow of fuel to the outside of the state was reversed rapidly.

Emergency Redirection

The weekend before Labor Day, as Irma’s degree of threat became clearer, Florida gasoline providers and emergency managers came together to define strategies. They knew there would be a gasoline emergency, although it was still unclear what parts of the state would be evacuated. So fuel shipments that could go to Florida were diverted from everywhere. The barges that normally carry the fuel from the unconnected Gulf Coast refineries were redirected to New York and Philadelphia to bring gasoline to the south. The oil tankers of Louisiana and Mississippi sailed swiftly eastward to reach Florida in time, having been delayed because of Harvey’s fearsome trajectory. An oil trading company redirected two European barges to Africa to Florida. According to Hillary Stevenson, research director for the oil market of analyst firm Genscape, the state received about 570,000 barrels from Europe before Irma to offset the supplies it had lost with Harvey.

Florida Gov. Rick Scott also eliminated truck weight requirements and truck driving hours to ensure more gas would arrive at more places before the weekend; gasoline trucks came from all the surrounding states of the southeast.

“We were accepting supplies from anywhere they shipped them,” says James Miller, director of the Florida Petroleum Marketers and Convenience Store Association, a trade group designated to coordinate fuel supplies with the state in case of an emergency. “The timing of Harvey and Irma was not the ideal.”

But all that could not keep pace with rising demand for fuel on Thursday, Friday and Saturday. Once Governor Scott called for an evacuation order for virtually all of South Florida, “everyone in those six or seven counties needs to get in their cars, fill their tanks, and move north,” James says. “So all those shortages that had been contained in Florida spread to the north.”

Then came the gas-free cars on the sides of the roads and people scared to leave their homes.

Manipulation of gas prices or the invisible hand of the market?

Fortunately, Irma was not a repeat of Hurricane Rita, where dozens died attempting to evacuate Houston’s congested low-fuel roads in 2005 . Florida Transportation Officers coordinated this evacuation very well. The state was spared catastrophic damage when Irma’s trajectory moved away from the largest population center.

But the Floridians did not forgive them when filling their gas tanks. By Tuesday night, more than 9,000 complaints of scams – mostly on gas and water – had flooded Florida’s attorney general’s office: Imagine a price tag of $ 5.99 per gallon of unleaded gasoline .

Gasoline is a futures market; can be bought and sold based on the prices of futures contracts, established by supply and demand. The predictions of incoming storms and the huge demand for gasoline that often accompany them are “absolutely” included in these prices, says Stevenson, whose company monitors the price of fuel in spot racks, the intermediate locations between refineries and suppliers where the trucks go to stock up to take the fuel to the gas stations.

Although many gas station chains, companies and government agencies buy fuel at contractual prices, others buy ‘cash’ at any rate. That price, Stevenson says, rose 26 cents a gallon on the eve of Irma’s passing. By Tuesday, the average price of one gallon was $ 2.71 in Florida , an increase of more than 44 cents compared to last month (that price increase is also partly due to Harvey’s fuel shortage) .

“The pain you feel when it comes to paying for gas was not entirely the fault of those who take advantage of an extreme situation,” she says. “Part of that was already included in the price, like the price of the underlying commodity.”

Therefore, unscrupulous gas station owners are not required to swindle drivers at gasoline pumps, which the Florida attorney general watches closely. Only the basic principles of economics are required.

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