New Jersey struggles with gas supply

TRENTON, N.J., Nov. 2 (UPI) -- New Jersey residents are grappling with gasoline shortages in the aftermath of Hurricane Sandy.

U.S. Sens. Frank R. Lautenberg , D-N.J., and Robert Menendez, D-N.J., on Thursday called for U.S. President Barack Obama to release emergency fuel supplies to the state.


"We are dealing with a crisis on the ground with rescue and recovery where millions are without power and without basic necessities. Furthermore, our constituents are sitting in lines up to a mile long waiting to fuel their vehicles, tying up local resources that are managing traffic conditions in these areas," the senators wrote in a letter to Obama.

"Additional resources" are needed to transport fuel to gasoline stations that have electrical power, the senators said.

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As of Thursday, more than 1.7 million customers in New Jersey remained without power, down from more than 2.7 million at the peak of outages, The Star-Ledger newspaper in Newark, N.J., reports.

Without electricity, the gasoline can't be pumped.

"This is not a supply problem. This is a delivery problem," Sal Risalvato, executive director of the New Jersey Gasoline, Convenience Store and Automotive Association was quoted as saying by the newspaper. "There is plenty of supply. We just can't get it from those big tanks you see along the (New Jersey) Turnpike through the channels that put it in customers' cars."

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About 75 percent of the stations of the approximately 1,000 gas retailers the association represents were closed Thursday either because they had no gasoline or no power or neither of the two.

"The quick and dirty is that in the Northeast, about 24 percent of the refining capacity that was in the line of the storm is out," Addison Armstrong of Tradition Energy told CNBC. "That's really just two refineries, the Bayway refinery in New Jersey and another smaller refinery there."

Charlie Drevna, head of the American Fuel and Petrochemicals Manufacturers Association, said the service stations are the microcosm of the problems that refiners have of delivering the fuel.

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"You have service stations that have full tanks and no power, and you have service stations that had fuel and they are running out rapidly," he told Platts news service. "It's just going to take time to get all this sorted out. The problem is power and flooding, whether it's at the refinery or at the terminal or anywhere along the route."

Andrew Lipow, president of the consulting firm Lipow Oil Associates in Houston said that energy operations in the Linden and Bayway area are responsible for about three-quarters of the fuel consumed in the New York metropolitan area.


"There's really no amount of catch up that the system can do with all of the Jersey terminals shut down," he told CNBC. "My estimate is it will be seven to 10 days," before the situation normalizes.

"It's going to be tough. Stay home. Conserve your gas," Lipow advised.

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