With the switchover to ethanol in gasoline from the additive MBTE, gas shortages are occuring at some filling stations across the US. The disruption may continue for several months according to US Energy Secretary Samuel Bodman.
It's not the supply of ethanol that's the problem. It's the logistics of shipping it to where it needs to be that is causing the issues relating to the shortages. The ethanol is actually mixed at the stations, rather than at the refineries, as MBTE was. That and the filling stations need to empty out and clean the tanks before the switch-over. The cleaning process can take up to two days.
In early April, up to 60 service stations in Dallas ran out of gasoline, because the tanker trucks that would normally be delivering their gas were delivering ethanol instead.
The average price of gasoline is rising to $3 a gallon with concerns over the switchover, the summer traveling season, and leftover issues relating to Katrina all contributing to the climbing rate.
Source: Bloomberg.
Monday, April 24, 2006
Gas shortages are minimal and scattered
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