• Lines grow, tempers flare at pumps as gas shortage grows after Sandy

    With limited mass transit, more folks are forced to use cars, and that, combined with a gas shortage, is creating gas station lines extending for miles all over New York and New Jersey. NBC's Tom Costello reports.

    By NBC News staff and wire services

    Updated at 7:55 a.m. ET: Motorists in New York and New Jersey exchanged words – and reportedly even shoves and punches – as they faced a second day of stressful, sometimes miles-long lines Thursday at the gas stations that still had both electricity and supplies after superstorm Sandy.

    Power outages kept many pumps out of service and tough travel made fuel deliveries difficult.

    A police officer directed traffic at a Gulf station in Newark, N.J., as a line of vehicles stretched for about two miles. Dozens of people with empty red gas canisters also stood in the line that snaked around the station.

    NBC's Kerry Sanders reports from a helicopter high above Bloomfield, N.J., where drivers are lined up for miles waiting for a chance to fill up.

    Betty Bethea, 59, had been waiting almost three hours as she approached the front of the line of cars, and she brought reinforcements: Her kids were there with gas cans, and her husband was behind her in his truck. 


    "It is crazy out here — people scrambling everywhere, cutting in front of people. I have never seen New Jersey like this," Bethea said.

    Police in New Jersey said they broke up fights at gas stations all day Wednesday, according to the Wayne Patch. 

    "Everyone's panicking because all their gas tanks are on 'E,'" one officer was quoted as saying.

    Numerous reports of confrontation at the stations that were still open surfaced on Twitter and YouTube.

    Justin Lane / EPA

    A man waits in line on 10th Avenue to get gasoline for his taxi at a gas station on Thursday as New York City tries to recover from the effects of Sandy.

    A fistfight broke out Wednesday between customers at the Getty station on Route 59 in Monsey, N.J., the only functioning station in the area, Chiam Tzik, the station's manager, told Newsday. On Thursday morning, traffic stretched for at least half a mile on both sides of the road.

    In New York state, Yonkers Mayor Michael Spano signed an executive order rationing gas to 10 gallons per customer effective immediately.

    Related: Northeast may see long gas lines for a week

    New York taxi and car service companies started pulling vehicles off the road as service stations are now out of gasoline or power to run pumps.

    New York Gov. Andrew Cuomo and Connecticut Gov. Dannel P. Malloy authorized the Metropolitan Transit Authority to waive fares Thursday and Friday as an inducement to get people to take mass transit instead of driving.

    In another move to reduce congestion, New York City's Taxi and Limousine Commission announced Thursday that HOV restrictions on bridges have been lifted for liveries, “black cars” and taxis.

    NBC's Kerry Sanders reports from Yonkers, N.Y,, where an aerial view of the New York City region shows a traffic nightmare as officials set up checkpoints to make sure every vehicle has at least three passengers before they are allowed into the city.

    Taxi drivers are accepting normal metered fares but are also permitted to accept additional passengers during a trip, according to The Wall Street Journal. The Taxi and Limousine Commission suggests $10 per additional passenger, but it’s up to drivers and passengers to negotiate the final amount, the Journal reported.

    For millions of Americans, Thursday morning marks day three of no electricity, and many will be without power for days to come. NBC's Harry Smith investigates why Sandy is the third storm in only a year to cripple the Northeast power system and whether it's simply part of a new normal.

    Zipcar Inc, a car-sharing company that rents out vehicles at an hourly or daily rate, said members late in returning cars in New York because of traffic or fuel shortages would not face the usual charges.

    "Any members who are willing to wait in line for fuel, we're willing to waive any late fees," said Dan Curtin, Zipcar's vice president of fleet operations in Boston. The firm is offering members in New York and New Jersey discounts until Friday.

    At the heart of the fuel supply crunch is the fact that Sandy has devastated the energy industry's ability to move fuel into and around the New York City region, particularly the harbor, by any of the three means that normally supply the area: tanker imports from abroad; pipeline shipments from the U.S. Gulf Coast; or refinery production from the mid-New Jersey area. 

    The good news is none of these issues appears to be long-lasting. Power is gradually being restored in New Jersey, where much of the key infrastructure is located and New York Harbor barge traffic is expected to resume later Thursday. A key pipeline should resume limited deliveries on Friday. Even flooded refineries should eventually resume production.

    The bad news is that the supply crunch may get worse before it gets better. Supplies at gas stations that remained open are running out, and it may be several more days before wholesale fuel supplies get where they need to go. Public Service Enterprise Group Inc, the biggest utility in New Jersey, said it may be up to 10 days to fully restore power. Oil tank trucks are driving three hours to Delaware City to get fuel, but they can only carry up to 9,000 gallons each.

    Reuters and The Associated Press contributed to this story.

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  • Gas prices roar to California record, hitting average of $4.614 per gallon

    As Californians' wallets are being hit hard at the gas pump, the national average continues to climb. Diana Alvear reports.

    By Jason Kandel and Antonio Castelan, NBCLosAngeles.com

    Gas prices hit a new record in California on Saturday: an all-time average high of $4.6140 per gallon.

    The news comes as prices are expected to continue to go up in the next couple days, according to the Automobile Club of Southern California.

    Gas prices have gone up 47 cents in the past week in California. A refinery shortage and a recent power outage at a plant in Torrance were to blame for the recent fuel price spikes.

    Also on NBCLosAngeles.com: LA fuel search: Find the lowest prices

    Prices in California were the highest in the nation, leapfrogging Hawaii's this week. The national average was $3.81 per gallon.

    "This is ridiculous," said Edgar Marutyan, a taxi driver. "I don’t know how long we can go like this."

    Commuter Darryl Atlas agreed: "Five dollar gas prices -- now 6 -- is very unreasonable."

    The average price of a gallon of self-serve regular gasoline in Los Angeles County recorded its largest single-day increase on Friday, rising 19.2 cents to $4.539 -- its highest amount since July 12, 2008.

    It is 40.3 cents more than a week ago, 36.4 cents higher than a month ago and 71.5 cents greater than at this time last year, according to figures from the AAA and Oil Price Information Service.

    The record price in LA County is $4.626, set on June 21, 2008.

    The record was set by a fraction of a penny, according to AAA spokesman Michael Green. The previous high was $4.6096 on June 19, 2008.

    Mike Blake / REUTERS

    People line up to purchase gasoline at a Costco Gas Station in Carlsbad, Calif., on Friday.

    The Orange County average price also recorded its largest single-day increase Friday, rising 19.5 cents to $4.525, its highest amount since July 9, 2008.

    It has also risen by more than 1 cent on each of the past seven days, including 9.4 cents on Thursday and 5.9 cents on Wednesday.

    It is 41.4 cents more than one week ago, 37 cents higher than one month ago and 73.8 cents greater than one year ago.

    The record price in Orange County is $4.598, set on June 19, 2008.

    Jeffrey Spring of the Automobile Club of Southern California said that local refineries were dropping production levels, exporting supply to Mexico and other countries, and allowing inventory to dwindle in anticipation of switching over to production of winter blend gasoline.

    He also said that a refinery power outage and a pipeline incident occurred on Monday that sent wholesale markets into a panic about the adequacy of California fuel supplies.

    It's not clear how much higher prices will go, he said.

    “A lot depends on whether the perceived supply issues are quickly addressed,” Spring said.

    The Associated Press contributed to this report.

    In California, the average price of gas is up 36 cents in a week, to $4.49. And on Friday, some stations neared $6 a gallon. NBC's Kristen Dahlgren reports.

  • $6 billion-a-year ethanol subsidy dies -- but wait there's more

    Seth Perlman / AP

    Corn is delivered by the truckload to ethanol plants like this one owned by Archer Daniels Midland in Decatur, Ill.

    By Miguel Llanos, NBC News

    America's corn farmers have been benefiting from annual federal subsidies of around $6 billion in recent years, all in the name of ethanol used as an additive for the nation's vehicles.

    That ends on Jan. 1, when the companies making ethanol will lose a tax credit of 46 cents per gallon, and even the ethanol industry is OK with it -- thanks in part to high oil prices that make ethanol competitive.

    Ethanol output and exports reached record highs this year, and a federal law assures ethanol a longer-term share of the motor fuel market.

    "Like all incentives it was put in place to help build an industry and when successful, it should sunset," the Renewable Fuels Association said in a statement last week.

    What the industry doesn’t want to see, however, is an end to a separate tax credit for ethanol made not from corn but non-foodstuffs like switchgrass, wood chips and even the leaves and stalks of corn.

    Known as cellulosic ethanol, no one is selling it just yet due to its higher R&D and production costs. But the industry hopes to soon, and the production tax credit is up to $1.01 per gallon.

    The industry earlier this month asked Congress to extend that credit, set to expire on Dec. 31. 2012, for five years but lawmakers did not act before recessing last week.

    In the case of corn ethanol, the writing had been on the wall for months. The subsidy's death was confirmed last week when Congress passed, and President Barack Obama signed, tax legislation that did not extend it.

    Subsidized since 1979 as a homegrown fuel cleaner than gasoline, corn ethanol had plenty of opponents, environmentalists among them.

    Environmentalists question the cleaner energy premise -- adding factors like tractor diesel emissions and fertilizer runoff make it dirtier, they say.

    "Corn ethanol is extremely dirty," Michal Rosenoer, biofuels manager for Friends of the Earth, said in heralding the tax credit's demise. "It leads to more climate pollution than conventional gasoline, and it causes deforestation as well as agricultural runoff that pollutes our water."

    Opponents also see corn ethanol, which now takes a larger share of the U.S. corn crop than cattle, hogs and poultry, as a factor in driving food prices higher.

    "The end of this giant subsidy for dirty corn ethanol is a win for taxpayers, the environment and people struggling to put food on their tables," Rosenoer added.

    A CNBC panel last June debates the impact of the ethanol subsidy on gas prices.

     

    Environmentalists do support cellulosic ethanol in principle since it doesn't compete with corn as a foodstuff.

    But there's a nearer-term battle brewing over corn-based ethanol. A 2005 law requires that 7.5 billion gallons of renewable fuel be produced by 2012 -- 6.25 billion gallons were produced in 2011. A 2007 revision gradually increases that to 36 billion gallons by 2022.

    So far most of that renewable fuel has been corn-based ethanol.

    "We will now also turn our attention to ending other federal policies that support dirty corn ethanol, including the Renewable Fuel Standard," said Rosenoer.

    Some environmentalists say that standard could be a useful tool to incentivize clean ethanol.

    The standard needs "to be strengthened and improved over time" to avoid "being taken over by corn-based biofuels," Nathanael Greene, director of renewable energy policy for the Natural Resources Defense Council wrote in his blog last week.

    Greene's fear is that the standard might be weakened by those opposed to measuring a fuel's emissions of gases tied to global warming and its impact on land use.

    As for tax credits, Greene told msnbc.com that the his group would like to see "a technology-neutral, performance-based tax credit that pays more" the cleaner a fuel is.

    Short of that, the NRDC is OK with extending the cellulosic tax credit beyond the end of next year -- and figures lawmakers will take that route since it is an easy one. "Given the current dysfunction in Congress this seems pretty likely," Greene says.

    The ethanol industry, for its part, stresses it's only trying to jump start cleaner energy. "Unfortunately," the Renewable Fuels Association stated last week, "the same mentality does not extend to century-old tax subsidies supporting 20th century petroleum technologies."