US: Gasoline prices are at 7-year highs 1:08
New York (CNN Business) -
When tens of millions of Americans hit the road this holiday weekend, they will find the highest gas prices in nearly seven years.
But many will also find stations without a drop of fuel.
The national average price for a gallon of regular gasoline is $ 3.10, the highest since October 2014. The average has risen just 2% since Memorial Day, but 42% from a year ago, when the restrictions from the pandemic halted demand and oil and gasoline prices plummeted.
But the fact that the stations run dry has nothing to do with the price, or even the supply, of gasoline.
It is the shortage of tank truck drivers coupled with growing demand that is causing bottlenecks and shortages in the supply chain.
Experts say that a growing number of stations report that they simply cannot dispense gasoline, at any price.
Right now, outages are all over the country, said Tom Kloza, global head of energy analysis for the Oil Price Information Service, which tracks prices for the American Automobile Association (AAA).
He said outages have been reported in the Pacific Northwest, northern California, Colorado and Iowa. Outages were also reported in Indianapolis and Columbus, Ohio, said Patrick DeHaan, a spokesman for GasBuddy.
Gasoline prices in America are at a 7-year high, just in time for Memorial Day
“It used to be an afterthought for station owners to schedule truck deliveries.
Now it's job number one, ”Kloza said.
“What worries me for July is the increase in demand that translates into between 2,500 and 3,000 more deliveries needed every day.
There are simply no drivers to do that.
Current U.S. gasoline demand is roughly the same as in the same period in 2019, according to the U.S. Energy Information Administration, but overall demand has risen 16% since the end of last year, the Last time there were so many commuters on the road during the Christmas season.
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AAA forecasts 43.6 million Americans will travel by car this July 4 weekend, the most so far this year.
And given the pent-up desire for summer getaways, Kloza said gasoline demand is likely to exceed the records that were in late summer 2019.
He's also concerned that when drivers see an occasional station out of gas, they will react by refilling their tanks more often than necessary, which in turn can lead to a gas shortage.
That's what happened last May, when the Colonial Pipeline cyberattack caused widespread outages at stations along the East Coast.
"We have the same advice we did then: This is not the time to fill every car you have and every container you have," said Jeff Lenard, vice president of strategic industry initiatives for the National Association of Convenience Stores.
"We hate seeing shortages and disruptions caused by drivers panicking and filling their tanks."
Idle trucks
Driver shortages are a problem throughout the trucking industry, but special qualifications are required to drive a tanker, making the shortage worse compared to other sectors.
According to National Tank Truck Carriers (NTTC), the industry's trade group, between 20% and 25% of tank trucks nationwide are parked heading into the summer due to a shortage of qualified drivers.
At this point in 2019, only 10% of tanker trucks were idle for that reason.
"We've been dealing with a driver shortage for a while, but the pandemic took that problem and metastasized," said Ryan Streblow, executive vice president of NTTC.
"It has certainly grown exponentially."
Panic would increase fuel prices in the US 2:15
The pandemic caused some tanker truck drivers to retire and others to switch to other trucking jobs that were in higher demand last year when gasoline demand fell so sharply.
Finding new drivers won't be a quick fix, said Brian Milne of data research firm DTN, which tracks energy prices and supplies.
"I know that the pandemic caused the retirement of several older drivers and they have been struggling to get new drivers," he said.
"I think it will continue to appear in different places."
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DeHaan said the current outages at gas stations are not as concentrated as they were after the Colonial Pipeline hack.
That makes it virtually impossible to get an accurate count of how many stations are running out of gas, but the number is growing.
"It is difficult to predict where the challenges are," he said.
"They are just random outbreaks in cities both small and large."
DeHaan expects the problem to increase over the next four to six weeks.
"I don't think demand has peaked yet," he said.
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