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Thu, Sep 01, 2005

Forget Prices -- Can You Fill The Tanks?

Hurricane Katrina Leaves Eastern Seaboard Short On Fuel

Hurricane Katrina's wrath spread to airports along the East Coast Thursday as airlines worried about the latest fallout from the storm: a pending fuel shortage that could ground flights from Tampa to Charlotte.

The hurricane knocked out refineries and cut power to vital pipelines that supply several airports with aviation fuel. Most affected, according to published reports, are airports in Charlotte, Fort Myers, Orlando, Tampa, Atlanta and Washington, DC. Most of those airports report having enough fuel in tank farms to last a week or two at most.

"By then, we'd better have this problem rectified or we'll have a serious problem," ATA chief economist John Heimlich told USA Today.

As supplies tighten, the price of fuel is rising. Prices are up 20-percent from the beginning of the week, deepening the woe of airlines like Delta, United and US Airways which are already in hot financial water.

In cases where pipeline service has been disrupted, aviation fuel isn't the only commodity in suddenly short supply. As lines stretch for blocks from gas pumps where drivers can still tank up, pressure is mounting to dedicate more of the flow in those pipelines to gasoline and diesel and less to aviation fuel.

Stay tuned.

FMI: www.air-transport.org

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