Premium gas shortages causes outages at the pump

Parts of the upper Midwest, including Eastern Iowa, are experiencing a shortage of premium gasoline, which also is used to create the non-ethanol base grade option.

That's the reason some pumps offering 91 or 87 clear gasoline in Cedar Rapids, Iowa City, Waterloo and other parts of Eastern Iowa, have been out of service of late, industry officials say. It's not clear how long the shortage will last, but no deliveries of premium are scheduled for at least another week, said John Gilroy from Harney Oil Co. in Coralville,

'There's an issue with premium,” Gilroy said. 'That is what nobody has right now, premium grade in the Magellan system.”

Magellan Midstream Partners, the region's largest supplier, supports many but not all gas stations in Iowa. BP stations, which are supplied through Buckeye Partners, has not seen a disruption, Gilroy said.

He said he does not know why Magellan's supply is so tight.

Bruce Heine, a spokesman for Magellan, said the pipeline lines are operating normally and don't have any mechanical issues.

Demand for premium is higher than normal, and the supply has not kept up, he said.

'The supply of premium has not allowed us to keep up with demand, which has caused some outages in the northern part of our territory, including Iowa,” Heine said, adding parts of North and South Dakota and Minnesota have also seen shortages.

A regulation change last year may be partly to blame for the increased demand, he said.

In 2013, in response to Federal Renewable Fuels Standard, a regulation that requires more ethanol be mixed with gasoline, refineries started shipping a sub-octane fuel - 83 octane, down from 87 octane. The change to 83 forced Iowa gas stations to either blend with ethanol or blend with premium gasoline to reach the minimum 87 octane fuel legal for retail in Iowa.

Heine said he could not answer what if any additional challenges there are limiting supply from refineries.

Rebecca Adler, senior communications director for American Fuel & Petrochemical Manufacturers, said her association is not aware of any issues with refineries, but did not comment on the reason for shortages.

Heine said Magellan will re-stock supplies in Iowa City as soon as possible, while Des Moines, which is its largest terminal in Iowa, still is receiving premium. Eastern Iowa distributors could travel to Des Moines and stock up, he said.

Gilroy said the ethanol blend is the cheapest option and by far the most popular. Meanwhile transporting premium from Des Moines to Iowa City would add costs. For those reasons, many distributors are trying to wait it out, he said.

There's also been a shortage of No. 1 diesel, which is a popular blend for winter, causing some headaches for truckers, he said.

The shortages of gas and diesel prompted Gov. Terry Branstad to make an emergency proclamation last week suspending certain hours of service regulations for commercial truckers transporting gasoline and diesel products until Dec. 6.

'Pipeline and refining outages affecting the supply of all petroleum products, coupled with the abrupt and early drop in temperatures, have resulted in low inventories of petroleum products in Iowa and the upper Midwest,” according to the proclamation.

Gail Weinholzer, a spokeswoman for AAA Minnesota/Iowa, said she doubts the shortages will put much a dent on traveler's plans for Thanksgiving.

'It's an inconvenience no doubt, but it is not going to have any significant impact on holiday travel,” she said.