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Stop the insanity!

September 13, 2008

About two years ago, hurricane Katrina hit the gulf coast and refineries and the gas pipeline that serves the southeast were shut down, driving a run up in fuel prices over several days to unprescedented levels.   I blogged about it, August 7, 2006.

I was in full rant mode, because there was still fuel in the ground and in the distribution network that really cost in the $2 range, yet prices ran up over the course of a couple days on speculation of potential outages and hit $3.   Putting aside economic supply / demand principles, I wondered why this really occured, after all, the gulf coast gets hit virtually every year by at least one hurricane, and several more pass through the coast region threatening oil platforms, triggering stopages and evacuations.

Pundits pointed to the concentration of refineries and the bottleneck of moving oil ashore, refining and distributing it.   Certainly, armed with this analysis, some action would be taken to prevent a re-occurance.  What was learned?  People would pay.  The world would not stop.  So what is the impetous to change the system?

Flash forward 2 years – it’s today.  Another hurricane, the pipeline is shut before the storm ever makes landfall and blows over a single tree on US soil, and the price of gas, in the course of one afternoon spikes $.60 per gallon.  I saw $4.59 / gallon gas tonight.   Really?   The base cost of the fuel in the ground didn’t change this afternoon, but a panic was created and everyone flocked – paid, and in some cases, closed out the stations.   

Orange cones blocking entrances pumps.  Lines of cars jockeying for position, horns blowing, arms waving.    Plasic grocery bags over the pump handles.

Ironically, tomorrow I leave for a trip to the coast.

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2 Comments leave one →
  1. September 13, 2008 1:47 am

    And all Prolly because Oil companies are the worst scum on the face of the planet.

  2. September 15, 2008 10:18 am

    The insanity got worse as I found gasoline stations pricing at over $5 a gallon on my way home that night.

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