Pouring gasoline "just in case" creates chaos, says economist 0:36
New York (CNN Business) -
A nasty surprise awaits the 34 million drivers expected to hit America's roads this Memorial Day weekend - the highest gas price in seven years.
And that could be the least of the problems for those who take to the roads for the summer holidays.
The gasoline shortage experienced earlier this month when a key pipeline closed could be on the horizon again, experts say.
This time around, the squeeze could be triggered by a lack of tanker truck drivers to deliver fuel and a repeat of panic buying by commuters filling their tanks.
"I think we have to worry about prices, supply and the behavior of the masses," said Tom Kloza, global head of Energy Analysis at the Petroleum Price Information Service, which tracks gasoline prices for the American Association. Automobile (AAA).
More demand equals higher prices
Prices first: The national average cost of a gallon of regular gasoline is now $ 3.04, according to AAA, essentially matching the seven-year high set earlier this month, and 58% more than it was ago. one year.
Last year, calls to stay at home - early in the pandemic - sent oil and gasoline prices plummeting, bringing the median price per gallon to less than $ 2. But even compared to the Memorial Day 2019, prices were up 7%.
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Higher oil prices, triggered by a rebound in economic activity and subsequent demand for fuel, are driving the increase. The start of the summer driving season this weekend will also boost demand and add further pressure to prices, as will the annual requirement for gas stations to switch to the more expensive 'summer mix' and designed to reduce seasonal smog.
But prices vary widely at the roughly 150,000 stations across the country, due in part to different taxes and fees, and in part due to fuel supplies from refineries in specific regions.
Only a third of US stations sell gasoline for more than $ 3 a gallon, but areas where prices are even higher are raising the national average.
Still, the most common price nationwide is just a tenth of a cent under $ 3.
For example, virtually all stations in California sell gasoline for $ 3.75 or more, with a regular average price at a national high of $ 4.17.
Meanwhile, Louisiana and Mississippi have a low national average of $ 2.72 per gallon, and almost no station in either state charges $ 3.
A repeat of the shortage?
Despite the high prices, a possible gasoline supply shortage looms as perhaps the most serious problem this summer.
A preview of what might look like came earlier this month when the Colonial Pipeline, a major artery carrying fuel from Gulf Coast refineries to the East Coast, was shut down for about a week due to a cyberattack. , which caused widespread outages at stations in many states.
Hackers paralyzed an oil pipeline.
Banks and stock exchanges are even bigger targets
But experts aren't as concerned about another malicious attack as they are about the critical shortage of qualified truckers to drive the tanker trucks that deliver gasoline to stations.
An estimated 20-25% of tanker trucks are currently parked due to a lack of drivers, according to National Tank Truck Carriers, the industry's trade group.
But even before the pandemic, there was a shortage of drivers, as the industry lost several of them during the economic slowdown that caused gasoline demand to plummet.
The supply shortage may initially affect only a few small, independent stations.
But the concern is that even a handful of resorts that are in short supply could lead to panic buying, particularly in beach communities and other vacation spots.
After all, nervous drivers filling their tanks was as much a cause of the recent shortage as was the closure of the Colonial pipeline, Kloza said.
And fresh memories of that shortage only make that kind of panic buying more likely, he added.
"I think the propensity for panic among the population is much, much greater than it has been," Kloza said.
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