Gas still hard to come by; N.Y. probes gouging

8:30 AM gouging, probes, still No Comments

Staff reports , NBC News

Updated at 3 p.m. ET: A week after Superstorm Sandy swept ashore, drivers and others seeking fuel continued to face lines and frustration in New York and New Jersey as authorities worked to restore the complex supply network of pipelines, refineries and distribution points.

New York State Attorney General Eric Schneiderman launched an investigation into possible price gouging on gas, generators and other items, saying he has received more than 400 complaints. Some consumers complained of being charged $10 for a box of matches and $7 for a loaf of bread. A similar investigation was launched last week in New Jersey.

"Our office has zero tolerance for price gouging," Schneiderman said in a statement. "We are actively investigating hundreds of complaints we've received from consumers of businesses preying on victims of Hurricane Sandy, and will do everything we can to stop unscrupulous individuals from taking advantage of New Yorkers trying to rebuild their lives."

New York's law does not specifically define gouging but prohibits retailers from charging "unconscionably excessive" prices in an emergency.

New Jersey's Division of Consumer Affairs said it has issued subpoenas to 100 businesses across the state, stepping up its investigation into more than 1,200 consumer complaints, mainly about alleged price gouging at gas stations, hardware stores, convenience stores and hotels, according to Attorney General Jeffrey S. Chiesa.

In some cases gas stations reportedly raised prices by more than $1 a gallon after the storm, according to ConsumerAffairs.com. The state also has received complaints about stations charging more to fill up hand-held canisters than to fill car gas tanks in violation of the law, the website reported.

Relief was in sight as barges and military planes have been deliver fueling to terminals since Thursday. But authorities have had trouble moving the fuel to consumers, in part because so many gas stations still have no power, rendering their pumps useless.

"It's like war," Sam Aushulumov told NBC News near a Gulf station in Brooklyn where he had been waiting more than three hours with just one gallon of gas left in his Volvo. The station on Coney Island Avenue had seven police officers keeping order, a line of cars stretching nine blocks and 65 people standing in line with gas canisters.

Taxi driver Joseph Mosely, waiting in line with two, five-gallon canisters, estimated he had lost $1,000 in income so far due to the storm.

"No gas, no income," he said.

In addition, more than a dozen of the 20 main terminals in New Jersey remain offline, according to CNBC. reports CNBC.


The Coast Guard was busy cleaning up several oil spills, including a leak on the Arthur Kill waterway, which separates Staten Island in New York City from New Jersey. Tankers damaged by Sandy spilled diesel fuel into the waterway last week and crews were still pumping contaminated water on Sunday afternoon.

Yet another cleanup effort was under way a few miles on the waterway, near Kinder Morgan's Perth Amboy, N.J., terminal, where the Coast Guard said it had recovered 780,000 gallons of an oil-and-water mixture. Kinder Morgan, however, said there was no spill from its Perth Amboy facility.

As more area residents returned to work, anxious drivers trying to fill up continued to strain the system.

Paul Eng of Queens told NBC News he waited for two hours only to be turned away, with police watching carefully, when gas ran out. Another station near his home had “lines that wrapped around the city block and wait times of three and a half hours," he said.

However, he's not letting the situation make him feel desperate.

He still has a quarter tank of gas left in his Honda CR-V and an all-electric Ford Focus in the garage. “All batteries, no gas needed,” he said.

John Horfmeister, former CEO of Shell Energy, said the long lines were being driven more by fear than simple demand.

"Fear (that) when you need gas there won't be any," he told TODAY. "The drivers put excess demand on a system that is undersupplied."

Horfmeister said New Jersey Gov. Chris Christie made a good decision in ordering 1970s style gas rationing, in which motorists can only buy gas on odd- or even-numbered days, depending on their license plates.

"Odd-even was a good decision, because it reduces demand by mandate," said Horfmeister.

Once power and the gas distribution system are fully restored, it will take about five days for the lines to die down as drivers get refueled and sorted out, Horfmeister said.

One bright spot in the fuel picture is that gas prices have been falling sharply nationwide, in part because of the decline in demand caused by Sandy, which has kept so many millions of people at home or close to home, because of lack of transportation, lack of power or the need to clean up.

The national average gas price dropped seven cents over the past week to $3.47 a gallon, AAA says. That's cold comfort, however, to drivers who wait for hours who are then forced to drive off empty-handed when the underground tanks run dry.

Gas prices have risen slightly in New York and New Jersey, up three cents in New York and seven cents in New Jersey, the Associated Press reported.

Several websites have been launched to help drivers find fuel. Google Crisis Map overlays vendor- and user-supplied data onto a Google Map to show where stations are open and reporting fuel levels. GasBuddy.com's mobile-device optimized site, drawing on user reports, showed “No Fuel” at many stations in the affected area.

Along New Jersey's busy Route 3 corridor, which feeds into Manhattan, several brand-name service stations remained shut, Reuters reported. A Hess outlet that held ample supplies in recent days had a line of about 30 cars -- down from more than 100 last week.

Adding to the misery, a Nor'easter storm was on track to hit the region Wednesday with winds up to 55 mph, near-freezing temperatures and possibly more power outages.