Fuel Prices Rise Briefly After Attacks
Sep 14, 2001 12:00 PM
The average price of diesel fuel increased 5-cents per gallon since terrorist attacks on the World Trade Center and the Pentagon, according to T-Chek Systems, a payment and information service for the transportation industry.
T-Chek said the average price for a gallon of diesel in the U.S. is $1.542. The Department of Energy said Monday that the average U.S. price was $1.492. T-Chek said the price rose because retailers are concerned with product availability, distribution schedules and wholesale costs.
Earlier Wednesday, groups such as the American Petroleum Institute (API), American Automobile Association (AAA), and several retailers said they were taking steps to ensure consumers that gasoline and diesel fuel is plentiful at regular prices despite the Tuesday's attacks.
"We remain confident that fuels are flowing normally to wholesale and retail markets throughout the United States. Gasoline and diesel fuel inventories are adequate to meet demand and refinery production remains strong."
ExxonMobil, the number 1 US oil company, said Wednesday that it has enough gasoline for its retail customers at prices that have not increased at the almost 1,000 gas stations it owns and operates, Reuters reported.
Shell has assured many gas station owners in the Midwest that wholesale prices will not rise on Wednesday.
AAA spokesman Geoff Sundstrom said that regular gasoline retail prices in the U.S. fell 0.4-cents Tuesday to $1.529 per gallon, but added that the price could rise as high as 5-cents by the end of the week.
Some areas, especially in the Midwest, saw prices rise because of panic Tuesday, then drop back to near normal Wednesday. For example, one gas station in Oklahoma City began charging $5 per gallon for self-serve regular.
"We are aware of reports of lines forming at gas pumps in some sections of the country and of isolated panic-related incidents caused by fears that a disruption in the gasoline supply system could lead to higher prices or shortages,” API said. “There are allegations that some gasoline stations are taking advantage of the situation to increase their prices.”
For example, one gas station in Oklahoma City began charging $5 per gallon for self-serve regular.
"We were in a panic. Rumors were flying all over the TV and our suppliers called and said they were unsure when they could get us gasoline and that it would cost us $4 to $5 a gallon," station owner Ralph Pfenninger told Reuters today, after bringing his self-serve regular price back to $1.649 per gallon. Today he is refunding the difference to his customers.
Prices also temporarily hit the $5 range in St. Louis, $3 in Indianapolis, and $3 in Cleveland.
"Although there were indications that major oil companies were urging local gasoline distributors and station owners to exercise price restraint, markets in the Midwest were seemingly exempt from sudden price spikes," said Mark Bruno, spokesman for the AAA-Chicago Motor Club.
In Georgia, state agriculture commissioner Tommy Irvin said he has deployed more than 100 state inspectors to be on the look out for price gouging at gasoline stations and that he has received reports that there should be no petroleum delivery delays to Georgia.
Irvin is urging all consumers not to hoard gasoline, "that can cause temporary local shortages and unwarranted panic." The Department of Agriculture will report all findings of gouging to the Governor's Office of Consumer Affairs and Georgia Emergency Management Agency for investigation and further action.
The Tennessee Oil Marketers Association (TOMA), which represents independent petroleum marketers and convenience store operators, said it is assuring consumers that there's an adequate supply of gasoline to meet the state's needs. TOMA said it is aware of reports of lines at gas pumps because of fears and rumors that the nation's gasoline supply will be disrupted, causing shortages of supply and higher prices.
"Our members have been assured by their major oil company suppliers that they will be doing everything possible to ensure that supplies of fuel into Tennessee continue uninterrupted," said Marylee Booth, executive director of TOMA. "Gasoline and diesel fuel inventories are adequate to meet demand and refinery production remains strong."
Philadelphia-based Sunoco Inc. said today that it must do its part by insuring that its facilities are secure and productive so that products are available in the markets it serves. The company said its current appraisal is that markets are adequately supplied and there is no reason for excessive price increases.
Sunoco said it is setting the prices that it controls in an appropriate manner to insure reliable supplies to Sunoco locations. However, the company does not control all the pricing decisions at every Sunoco station. The company said that no one should try to take advantage of the situation and urges anyone with a concern about any Sunoco location to contact the company.
Jean Gaulin, chairman & CEO of San Antonio-based Ultramar Diamond Shamrock (UDS), said that the company’s 1,500 company-owned Diamond Shamrock, Stop-N-Go, Beacon, Ultramar and Total gasoline retail locations did not increase gasoline prices in response to the terrorist attacks
However, customer response to the tragedy and the sudden unexpected demand caused some UDS stores run out of fuel.