The Environmental Protection Agency (EPA) recently approved request for an emergency fuel waiver for Allegheny County, Pennsylvania. EPA Administrator Andrew Wheeler approved the waiver on Thursday May 30, 2019, one day after receiving the request. The emergency fuel waiver was submitted after damage to the Buckeye Laurel Pipeline created a supply shortage of 7.8 psi Reid Vapor Pressure (RVP) in Allegheny County. Low RVP gasoline in Western Pennsylvania is typically supplied from refineries on the East Coast and the Laurel Pipeline disruption has effectively cutoff the supply.
Many disruption scenarios can occur when a hurricane hits the U.S. directly. Whether it hits the Gulf Coast refineries and off shore oil rigs, New York Harbor refineries or the Carolina’s where there isn’t an energy infrastructure presence but a high density of population. I had the pleasure to meet with one of our experts, Mike Dombroski, Commercial Sales Account Manager to discuss in more detail how to better prepare and what could happen to fuel prices if you’re not ready.
Shale production is surging in the United States, however it’s surging into pipeline bottlenecks, creating mass delivery issues. Pipeline shortages are having a particularly frustrating effect in Oklahoma and in the Texas Permian Basin, forcing some companies to truck barrels up to 500 miles in order to get it to the gulf coast. These bottlenecks are expected to last until 2019, or even 2020, and combined with a tight labor market for drivers, there is a finite limit to the amount of crude that could be used to help stabilize the international market.