Gasoline shortages in Phoenix area

Gas shortages hit Valley, some stations run out


Some stations out of gas, and situation may worsen

Max Jarman
The Arizona Republic
Mar. 7, 2003 12:00 AM

Gas shortages are hitting some Valley stations, and it could worsen by the weekend.

Many independent stations run by Costco, Safeway and Albertsons were out of gas Thursday, even as the average price of regular unleaded in the Phoenix area hit another record at $1.77 per gallon.

Matt Homan, who runs stations at six Safeway grocery stores, said most of his stations were out of premium and mid-grade Thursday, with no prospects of more until Sunday or Monday.
"The weekend is going to be rough," he said.

The supply problem stems from the fact that two of the refineries that produce Phoenix's unique oxygenated winter fuel have been shut down. The Phoenix formula changes April 1.

Some gas distributors have no product to sell, and others have their retail customers on rations until the end of the month.

However, officials at major gas retailers, such as Chevron-Texaco and Circle K, say they have enough gas but acknowledge supplies are tight.

Independent retailers and distributors are pleading with the state to relax its rules on oxygenated gas to allow plentiful supplies of non-formulated gas to be brought in from other areas.

Gov. Janet Napolitano plans to meet with suppliers today to assess the situation and will consider all options, spokeswoman Kris Mayes said.

Gas station operators across the Valley are hoping relief comes soon.

Six of the seven Costco stations were out of gas Thursday afternoon, and the seventh was expected to run out today.

Costco Vice President Paul Latham said the company would add limited supplies to its Scottsdale, Glendale and Gilbert stores each day through the weekend, but he added that it would not last through the day.

Albertsons also has run out at two of its 11 Phoenix area fuel centers, but officials are working to get more fuel.

While independent retailers are being hit first, the shortage could eventually affect some of the major gas retailers, observers say.

"My understanding is that most everybody in Phoenix is affected," said Mark Cox, chief financial officer at Giant Industries, a Scottsdale petroleum distributor and retailer.

Julie Igo, a spokeswoman for Conoco-Phillips, which operates 350 Circle K gas stations in the Phoenix area, said supplies are tight but the company is confident it could manage its inventories to ensure supplies at all of its stations.

Other chains such as ARCO, ChevronTexaco and ExxonMobil said that their stations have gas to carry them through the weekend but that supplies are not as plentiful as they were.

Giant's Cox said that only four refineries produce the so-called Maricopa gas that the Legislature requires Valley retailers to sell in winter months to reduce pollution.

"With only four refineries, a glitch at any of the refineries is going to create supply problems," he said.

Two of the four refineries recently closed for maintenance and to convert to summer products.

Producers are reluctant to commit their resources to the winter product, Cox said. He predicted the supply would remain unstable until April.