Culver offers plan to combat fuel shortage
1:00 AM
Posted: Friday, July 13, 2007
DES MOINES (AP) -- Gov. Chet Culver has temporarily lifted limits on how long gasoline and diesel truck drivers can work, a move designed to combat fuel shortages that have prompted higher prices across the region.
Normally drivers in Iowa are limited to 12-hour delivery shifts, with a minimum of 10 hours off after each shift. Culver on Thursday issued a 30-day waiver on the limit, saying he wants to ensure drivers have enough time to make their deliveries.
Analysts say the July 1 closure of a refinery in Coffeyville, Kan., due to flooding, and the shutdown this week of a huge piece of oil processing equipment at a BP PLC refinery in Whiting, Ind., have sent prices in the Midwest and Plains states sharply higher.
Gas prices in parts of Iowa have risen as much as 35 cents a gallon in the past few days. The price of gasoline blended with 10 percent ethanol was $3.14 a gallon at many Des Moines pumps on Thursday, with regular unleaded selling for about 10 cents a gallon more.
"This was a necessary step," Culver said. "Supplies were tight to begin with, and then after the Coffeyville, Kansas, refinery was flooded last week, supplies became very tight."
Minnesota, Nebraska, Kansas, North Dakota and South Dakota have also lifted limits of drivers' shifts.
Tight supplies in those states and outages at some smaller Iowa terminals have forced drivers to travel extra miles to fill their tanker trailers, often having to wait in long lines for hours.
Brian Crowe, an energy analyst for the Iowa Department of Transportation, said the labor waivers and refinery recoveries should keep prices from increasing significantly again, unless there are new problems in the supply chain.
BP has said its 250,000 barrel-per-day unit would be up and running by the weekend. That sent gasoline futures down 6.31 cents in New York trading Wednesday.
Wholesale gas prices in the Chicago area dropped 28 cents Wednesday on that news, said Jim Ritterbusch, president of Ritterbusch & Associates in Galena, Ill. If that trend holds, retail prices will soon follow.
Normally drivers in Iowa are limited to 12-hour delivery shifts, with a minimum of 10 hours off after each shift. Culver on Thursday issued a 30-day waiver on the limit, saying he wants to ensure drivers have enough time to make their deliveries.
Analysts say the July 1 closure of a refinery in Coffeyville, Kan., due to flooding, and the shutdown this week of a huge piece of oil processing equipment at a BP PLC refinery in Whiting, Ind., have sent prices in the Midwest and Plains states sharply higher.
Gas prices in parts of Iowa have risen as much as 35 cents a gallon in the past few days. The price of gasoline blended with 10 percent ethanol was $3.14 a gallon at many Des Moines pumps on Thursday, with regular unleaded selling for about 10 cents a gallon more.
"This was a necessary step," Culver said. "Supplies were tight to begin with, and then after the Coffeyville, Kansas, refinery was flooded last week, supplies became very tight."
Minnesota, Nebraska, Kansas, North Dakota and South Dakota have also lifted limits of drivers' shifts.
Tight supplies in those states and outages at some smaller Iowa terminals have forced drivers to travel extra miles to fill their tanker trailers, often having to wait in long lines for hours.
Brian Crowe, an energy analyst for the Iowa Department of Transportation, said the labor waivers and refinery recoveries should keep prices from increasing significantly again, unless there are new problems in the supply chain.
BP has said its 250,000 barrel-per-day unit would be up and running by the weekend. That sent gasoline futures down 6.31 cents in New York trading Wednesday.
Wholesale gas prices in the Chicago area dropped 28 cents Wednesday on that news, said Jim Ritterbusch, president of Ritterbusch & Associates in Galena, Ill. If that trend holds, retail prices will soon follow.
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BILL wrote on Jul 13, 2007 7:49 AM: