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TFFA Board Member Rodney Fischer and Staff Discuss Fuel Grades and Supply with San Antonio Express-News

TFFA Board Member Rodney Fischer and Staff Discuss Fuel Grades and Supply with San Antonio Express-News















Article by 
Rye Druzin, Business Reporter, San Antonio Express-News

Most San Antonio gas stations now have fuel, but drivers aren’t traveling smooth roads yet — the supply disruptions linked to Hurricane Harvey continue to limit the types of gasoline for sale.

Many pumps around the city are operating, but only with regular gasoline. Some stations still have homemade “sold out” paper signs covering the midgrade and premium options.

It’s nothing personal, luxury-car drivers.

Patrick DeHaan, senior petroleum analyst for gas price tracker GasBuddy, said that because the majority of gasoline purchased by customers is lower-octane regular fuel, the midgrade and premium grades “are getting a little neglected.”

Refiners are trying to get regular gasoline — the most popular — to stations as fast as possible because there still are stations without any fuel of any kind.

In the San Antonio metro area — which includes Bexar County and the surrounding six counties — 21 percent of gas stations reportedly remained without fuel Tuesday, DeHaan said.

That compared to metro area fuel outages of 17 percent in Austin, 10 percent in Dallas and Houston, and 7 percent in Corpus Christi. Statewide, 6.5 percent of gas stations were out of fuel.

It wasn’t immediately clear why San Antonio had a higher rate.

DeHaan said the extent of outages in San Antonio may explain why it’s taking longer to restore fuel supplies.

At its peak on Sept. 2, nine of 10 stations were out of gas, or at least 575 of the 630 gas stations within San Antonio’s city limits, according to the tracker, which is based off consumer-submitted data and isn’t verified by GasBuddy.

Rodney Fischer, president of New Braunfels-based fuel wholesaler Midtex Oil, said his supplier, Shell, is focused on producing regular after the “great hoardfest of last week” emptied many gas stations.

“When these refineries come online they are filling most of their product at their most consumed grade of fuel,” Fischer said.

About 70 percent of what he sells is regular fuel. Midtex owns and operates 19 stores in and around New Braunfels, San Antonio and the Hill Country.

Jesus Azanza of the Texas Food and Fuel Association said premium fuels take longer to make because they require mixing of other materials to raise their octane, or energy amount.

“The bulk of a gas station’s fuel volume (how much it sells) is targeted toward drivers of vehicles that use regular gasoline,” Azanza said in an email.

In June, 82 percent of the 25.6 million gallons of motor gasoline sold daily in the U.S. was regular gasoline, according to data from the U.S. Energy Information Administration.

There’s a light at the end of the tunnel for San Antonio area drivers, though.

On a Tuesday morning conference call, Fischer said Shell told wholesalers that it hopes the fuel situation will look “pretty close to normal” to the public by the end of the week. Fischer said Shell added that behind the scenes there still could be some issues for wholesalers like him.

That’s an improvement from previous calls when Fischer was told resupply dates were “unknown.”

On the North Side, Naveed Muhammad, who owns an Exxon franchise, said Monday marked his first shipment of premium fuel in a week. Muhammad blamed Harvey-related refinery and pipeline shutdowns and damage inspections for continuing to hobble fuel shipments.

In the aftermath of Hurricane Harvey, a real, but relatively minor, supply issue was exacerbated by worried drivers buying 21/2 times the usual amount of gasoline in San Antonio.

The trouble all started when refineries pre-emptively shut down in Corpus Christi before Harvey made landfall as a Category 4 storm Aug. 25. More refineries in Houston, Beaumont and Port Arthur followed suit.

At one point more, than 20 percent of total U.S. refining capacity was taken offline. Texas pipelines bringing fuel inland from the coast also were shut down, further cutting supply.

Gas stations began depleting distribution terminals. Some stations in South and West Texas ran out of gas entirely.

Refiners have been trying to restart their plants. Industry research firm IHS Markit expects the amount of offline refining capacity to fall to around 10 percent by next week.

The EIA estimated that in September, U.S. crude oil refineries will process an average of 15.3 million barrels per day, down from an average of 17.1 million barrels per day in August.

In addition to waiting in gas lines, drivers have been paying more at the pump. Gasoline prices have spiked with the supply shortage.

On Tuesday, the EIA said that national average gas prices for regular, at $2.69 a gallon, were the highest since August 2015. The EIA’s short-term energy outlook estimates September gas prices will average $2.61 a gallon before dropping to $2.40 a gallon in October.

AAA said on Monday that national gas prices appeared to be leveling off at $2.67 for a gallon of regular, just 3 cents higher than a week before. AAA Texas’ Sarah Schimmer said Tuesday that San Antonio’s price had leveled at $2.53 a gallon from a week prior.

And for now, drivers with cars that take premium gasoline may have to settle for filling up with regular, which won’t damage a finely-tuned engine, at least not for a few months, according to local luxury car sellers and fuel suppliers.

High-performance engines may not like low-octane fuel, but the engine’s computer can adjust how it uses the fuel and risks little chance of damage.
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