Nov. 2, 2012 at 12:32 PM ET
Updated 7:40 p.m. ET: New York Harbor reopened Friday for the first time since Superstorm Sandy roared in and scattered debris into the waterway that is a vital conduit for the city's commerce, including the tankers that bring fuel for New York and New Jersey.
The Port of New York and New Jersey's reopening raised hopes that the fuel shortage that has caused the worst gas lines in the Northeast since the energy crisis in the 1970s would end soon.
“[The] issue of gasoline has created concern and anxiety and practical problems throughout the region,” Gov. Andrew Cuomo of New York said in a news briefing Friday.
"There's no question the supply of fuel will increase in New York Harbor,” Cuomo said.
Gas and oil prices fell as the harbor was reopened and federal authorities loosened restrictions, allowing foreign-flagged tankers to bring fuel from the Gulf Coast refining hub to the storm-ravaged Northeast,
Cuomo signed an executive order Friday allowing distributors and transporters to bring gasoline, diesel and kerosene into New York state without being required to meet typical registration requirements.
Late in the day the White House announced Federal Emergency Management Authority announced plans to buy up to 22 million gallons of gasoline and diesel fuel for distribution in storm-affected areas. The fuel will be transported by tanker trucks and distributed throughout New York, New Jersey and other communities, according to the Federal Emergency Management Agency.
Other means of getting fuel into the area were still limited. And that's bad news for drivers who have spent hours lined up for gas and for thousands of homeowners who have been forced to use gas-powered generators to light homes darkened by Sandy.
Meteorologists called Sandy a “perfect storm” of colliding events. The gasoline situation is similar, with high demand for fuel combining with supply bottlenecks to generate long lines and outages at area gas stations.
As of Friday afternoon, the American Automobile Association estimated 40 to 45 percent of gas stations in New York City and 45 to 50 percent of ones in New Jersey were currently operating. On Long Island, the AAA estimated the figure was between 35 and 40 percent. Although far from recovered, this was between a 5 to 15 percent increase from less than a day ago.
In Brooklyn, tax driver Mohammed Sultan told Reuters he had been waiting in line for nine hours, since midnight, for a rumored shipment of gasoline to arrive at a Hess Station on Coney Island Ave. He was hoping for a 10 a.m. delivery.
"I believe them," Sultan, 35, said. "But because of the gas problem, there are thousands of yellow cabs sitting around wasting time and money."
Two big pipelines were scheduled to resume partial operations Thursday and Friday, although the oil they carry only moves at a rate of 3 to 5 miles per hour, according to the Oil Price Information Service.
Even if the ports and pipelines were running at full capacity, though, getting that fuel into people’s cars presents other challenges.
One is the ongoing power outages, that render gas station pumps useless. “We are all dependent on utilities for electricity and that includes service stations and bulk terminals,” Tom Kloza, chief oil analyst at OPIS, said via email.
Some distribution facilities remain closed because they were flooded or otherwise damaged, especially in hard-hit areas of New Jersey.
As of early Friday, three refineries and more than a dozen terminals were shut or operating at limited capacity, according to the Energy Department. A terminal in Bayonne, N.J., wasn’t scheduled to restart operations until sometime next week.
BP is repairing flood damage at its terminal in Carteret, N.J., and has not yet assessed damage yet at its Port Newark facility, according to WNBC. The company’s Brooklyn terminal is operational but sidelined because it depends on supply from one of the still-crippled pipelines.
At the retail level, tankers won’t deliver fuel to a gas station that doesn’t have electricity to power its pumps. Only 35 to 40 percent of gas stations in New York City and New Jersey were operating as of Thursday, As of Thursday, the American Automobile Association estimated. On Long Island, the estimate was 30 to 35 percent.
“If you’re in an area that doesn’t have power, you’re obviously affected,” said Jeff Lenard, spokesman for the National Association of Convenience Stores. Backup generators are “simply too expensive” for most station owners, he said.
“What we see as the main problem is power lines have been down. ... As power is restored more stations should be opening,” said AAA spokesman Michael Green.
More stations open will mean fewer lines and less fear and anxiety, Green said.
“We’ve seen a bit of consumer panic,” Kloza said. “If consumers and commercial end-users panic, there will be moments where lines beget lines and become a self-fulfilling prophecy.”
The increase in demand isn’t just from people stocking up out of panic, though. Around 3.6 million homeowners are still without power in the Northeast, which means people are relying on gasoline to keep their heat on and refrigerators running.
The widespread damage to transit infrastructure pushed many mass-transit commuters into cars instead.
That pressure will be alleviated as more public transportation comes back online. The Staten Island Ferry went back into service at noon Friday, and more New York City subway lines resumed at least partial operations.
Lenard said the upcoming weekend should give gas stations some breathing room, since fewer commuters will need to fill up. As power is restored to more areas, that also will decrease the demand from homeowners running generators.
“We’re not going to be normal on Monday, but it’s going to be a whole lot closer to it,” he said.
Although it might be hard to believe for people stuck waiting literally hours for gas, things could be a lot worse, Kloza said, since typically there is a seasonal slump in demand for gasoline headed into Thanksgiving.
“We are lucky that this is November and not July. “