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New Jersey Drivers Wait for Fuel as Sandy Curbs Gasoline

Nov. 1 (Bloomberg) -- QRI CEO Nansen Saleri talks about the impact of Hurricane Sandy on the energy sector. He speaks on Bloomberg Television's "Bloomberg Surveillance." (Source: Bloomberg)

New Jersey drivers waited in two- mile-long lines to buy gasoline as Hurricane Sandy’s devastation of the New York metropolitan area flooded fuel terminals, curbed deliveries and left many filling stations in the dark and unable to run their pumps.

The queues for fuel only worsened hours-long traffic tie- ups on highways leading in to New York as Mayor Michael Bloomberg banned vehicles with fewer than three passengers from entering most of Manhattan. More than half of New Jersey filling stations likely are closed, Kashmir Gill, whose Creative Management Inc. owns 38 New Jersey outlets, said in a telephone interview yesterday.

“If you can even find a gas station, you better stop and fill up,” said Fred Kardasz, 50, a landscaper who said he waited in line in his white Chevrolet Tahoe SUV for 20 minutes to buy regular fuel for $3.49 a gallon at a U.S. Gas station in Hamilton, New Jersey. “You can’t find a gas station nowhere right now.”

About 17 percent of the 120,950 fuel-and-convenience stores in the U.S. are in the region affected by Hurricane Sandy, Jeff Lenard, a spokesman for the National Association of Convenience Stores in Alexandria, Virginia, said in an e-mail.

“The challenge for stores is getting power and getting fuel,” he said. “Retailers are doing anything that they can to find fuel -- and overpay for it -- so that they can stay open.”

Photographer: Emile Wamsteker/Bloomberg

Vehicles wait in line for fuel at a Sunoco Inc. gas station in Bloomfield, New Jersey, on Nov. 1, 2012. Close

Vehicles wait in line for fuel at a Sunoco Inc. gas station in Bloomfield, New Jersey, on Nov. 1, 2012.

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Photographer: Emile Wamsteker/Bloomberg

Vehicles wait in line for fuel at a Sunoco Inc. gas station in Bloomfield, New Jersey, on Nov. 1, 2012.

Refineries Shut

Hurricane Sandy, the biggest Atlantic storm in history, caused at least 75 U.S. deaths and blacked out millions of homes and businesses. Six Northeast refineries with 1.17 million barrels a day of processing capacity shut or operated at reduced rates because of the storm, according to the U.S. Energy Department. Colonial Pipeline Co.’s 825,000-barrel-a-day Line 3 pipe that carries gasoline and diesel from Greensboro, North Carolina, to Linden, New Jersey, will resume limited operations tomorrow.

That may come as little comfort for motorists in New Jersey New York City and other suburbs.

Some stations in Long Island are without power, and those that have lights are almost out of fuel, Kevin Beyer, president of the Long Island Gasoline Retailers Association said by phone. His station, Performance Fuels in Smithtown, New York, doesn’t have electricity.

Getting Worse

“The problem is there’s no fuel. The terminals are not going to be open until next week,” said Beyer. “It’s going to be mayhem for at least a week, and it’ll get worse before it gets better.”

Gasoline stations that do have power are being overrun by customers, he said. “The lines are astronomical. Most places are cash only. They don’t have Internet so they can’t process credit cards. People are getting upset and there’s nothing they can do about it.”

At a Mobil (XOM) station at 155th Street and Broadway in Manhattan’s Washington Heights, passing motorists barely slowed when they saw the red traffic cones and garbage pails placed in front of two rows of pumps bearing “OUT OF GAS” signs.

“Ask the dispatch,” said attendant Agapito Jimenez, 60, when asked when a fuel delivery was expected. “Only Mobil has the schedule.”

California Crunch

The New York area’s fuel crunch recalls a similar squeeze and price spike in California last month after an Exxon Mobil Corp. refinery curbed output after a power failure, a Chevron Corp. (CVX) unit was knocked out by a fire and a Chevron crude oil pipeline was shut by contamination. Governor Jerry Brown helped relieve the shortage by directing regulators to allow refiners make cheaper fuel.

New Jersey Governor Chris Christie directed state Treasury officials yesterday to waive licensing requirements that restrict out-of-state fuel purchases to boost storm-depleted supplies. The waiver will be in place until Nov. 7.

Royal Dutch Shell Plc (RDSA) said 47 percent of its Shell-branded gasoline stations in New Jersey were open as of 8 a.m. central time today. New York fuel terminals remain down, and the company is coordinating with other suppliers in the market to deliver product, according to a statement on Shell’s website.

Sixty-two percent of Shell-branded stations in New York and 83 percent in Pennsylvania are open, the company said.

Power Failures

Four out of Quick Chek Corp.’s 12 stations in New Jersey that have power are out of fuel, said Tim Holiday, the company’s fuel-category manager in Whitehouse Station. A station in the town had a line of cars that extended more than 2 miles (3.2 kilometers) yesterday, said Gill of Creative Management.

The long lines at fuel stations are due to power failures rather than supply issues, Michael Green, a spokesman for AAA in Washington, said in an e-mail. Few retailers in the Middle Atlantic or New England states have generators, he said.

The lines should diminish as power is restored, according to Green. AAA, the largest U.S. motoring organization is based in Heathrow, Florida.

“It’s going to be crazy,” said Gill. “People are running out of food, people are running out of gas and the temperature is getting colder.”

Gill said only 10 percent of his company’s stations were open yesterday. Store managers are taking only cash, and police are managing the lines where stations are open, he said.

It may take as long as 10 days for some stations to return to full operation, he said. The stations depend upon terminals to replenish their supply of gasoline, but many of the terminals are without power as well, Gill said.

Out of 28 petroleum terminals affected by Sandy, 14 were shut as of 7 a.m. in New York, according to the Energy Department.

“Everyone thinks it’s the end of the world,” said Holiday. “As soon as a place has gas, they line up.”

Bloomberg is founder and majority owner of Bloomberg News parent Bloomberg LP.

To contact the reporters on this story: Aaron Clark in New York at aclark27@bloomberg.net; Bradley Olson in Houston at bradleyolson@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net

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