Office of Energy Policy
Gasoline Situation Gradually Improving
Frankfort, KY, (Sept. 6, 2005) – On Friday Governor Fletcher requested the U.S. EPA temporarily suspend the regulations mandating the sale of specialty reformulated gasoline, or “boutique fuels,” in certain parts of Kentucky. Fortunately, due to improving petroleum operations in the Gulf Coast, Kentucky was able to withdraw the request.
Over the weekend, restoration of the nation’s petroleum infrastructure damaged by Katrina continued to improve.
Two major pipelines supplying fuel to the Southeast have returned to full operation on Monday and a pipeline supplying crude oil to Kentucky and the Midwest has also returned to 89 percent of full capacity.
At least five major refineries remain off-line. However, progress continues to be made in returning a number of Gulf Coast refineries to service. Over the weekend, nearly a half million barrels per day of production came on line.
In addition, the Louisiana Offshore Oil Port or LOOP is back to operating at near full capacity. LOOP is an offshore facility that unloads crude oil and is connected to the pipelines that supply crude oil to the Midwest refineries that are critical to Kentucky’s petroleum users.
Also, the Mississippi River officially reopened on Monday to ships with a draft of 35 feet during daylight hours. This will enable barge traffic laden with petroleum products to use the river in both directions. Dredging operations that will allow even larger crude tankers to offload cargos are continuing.
Refineries are now processing crude oil from the Strategic Petroleum Reserve (SPR). The Administration had released some 8.5 million barrels of crude from the SPR as a “loan” and then late Friday announced the release of an additional 30 million barrels. The sale of this oil started today.
Another significant event for American consumers is the shipment of some 60 million barrels of oil, about half of it in the form of gasoline and diesel fuel, to the U.S. by Europe and Japan from their strategic reserves. Such mutual aid shipments are the result of international agreements that Western nations put in place to deal with oil supply disruptions.
While excellent progress is being made, there is significant work ahead to return off-shore oil and gas platforms to production. Currently, about 69 percent of oil production and 54 percent of natural gas production remains shut down.
Fuel conservation efforts over the holiday weekend had a positive impact, and Kentuckians are encouraged to continue taking steps to reduce their fuel usage until production and supplies are fully recovered.
Consumers in Kentucky who believe they are victims of price gouging should contact the Attorney General’s office at (502) 696-5389 or (888) 432-9257 (Option 3).