From This Week In Petroleum….

With refineries unable to fill pipelines that move product into the Midwest and East Coast, inventories have been dropping, and spot shortages, mainly of gasoline, are occurring, even with increasing imports arriving to help fill the gap. While the restoration of electrical power to refineries has progressed rapidly, it still takes time to bring refineries back online (assuming no mechanical problems occur) and even longer before they reach normal production levels.

Given these circumstances, gasoline inventories have declined to record low levels. At 179 million barrels, total motor gasoline inventories stand at the lowest level since 1967, based on monthly EIA data. Continuing reports of spot shortages of gasoline at some retail outlets where supplies have been most disrupted can be expected over the next several weeks. Distillate inventories and supplies are in better shape, but tight nonetheless. They remain within the lower part of the EIA-defined “normal” range for this time of year.

Robert Rapier explains how politicians have made this worse….

But prices aren’t going up nearly as much as you would expect during these sorts of severe shortages. Why? I think it’s a fear that dealers have of being prosecuted for gouging. So, they keep prices where they are, and they simply run out of fuel when the deliveries don’t arrive on time. If they were allowed to raise prices sharply, people would cut back on their driving and supplies would be stretched further.