"If
more effort isn't put into resolving some of these issues, it could
have serious impact on the operational integrity of the whole
aviation system," warned Bob Sturtz, general manager of fuel at Elk
Grove Village, Ill.-based United Airlines.
While progress is being made, airline and energy executives
predicted that the problem could get worse before it gets better.
Just outside Washington, officials at Dulles International
Airport are working with airlines as well as the Colonial Pipeline
Co. -- which transports gasoline, heating oil and jet fuel from the
Southeast to the Northeast -- to alleviate a regional bottleneck.
The goal is to build a wider pipeline to feed Dulles and an
additional 300,000 barrels of storage at the airport, according to
Chris Browne, the airport manager at Dulles. The project is still in
the design phase. For now, airlines are coping by having additional
jet fuel brought in by truck, Browne said.
The fuel supply woes are dogging an industry already losing
billions of dollars a year in large part because of soaring fuel
costs. The price of jet fuel averages $1.91 per gallon in Los
Angeles, up 46 percent from a year ago, according to government
data.
Airlines have used all sorts of strategies to improve their fuel
efficiency, from flying at slower speeds to taxiing on one engine.
These efforts have worked, but they have also been offset by their
maneuvering around supply bottlenecks.
America West's assistant treasurer Timothy Walker said the
industry deserves credit for its ability to manage these problems
without affecting service. But he conceded that making up for low
supplies with truck and airplane deliveries is not a long-term
strategy.
"The lack of fuel could slow growth in certain markets," Walker
said. He cited Phoenix and Las Vegas as two America West markets
likely to face fuel-supply challenges if traffic continues to grow.
Indeed, one of the latest supply snags to catch the industry's
attention began around July 20 in Phoenix. While accounts of what
happened vary slightly, it is agreed the trouble began after Kinder
Morgan did not make a scheduled delivery of jet fuel, at which point
carriers began "ferrying" extra fuel to Phoenix from California and
Nevada.
At first, it seemed a crisis was averted. Then it cascaded.
The near-shortage in Phoenix gradually spread to airports in
Reno, Nev., San Diego and Ontario, Calif. Jet fuel had to be trucked
in just to keep the ferrying program to Phoenix alive, executives
said.
Delivering jet fuel by truck is like "putting a handful of sand
on a beach," Hipp said. "It doesn't really keep up with demand."
San Diego and Ontario came so close to drawing down their fuel
inventories, Sturtz said, that airlines were a few hours away from
scheduling additional layovers so planes could refuel.
The crisis was resolved gradually as pipeline deliveries returned
to normal and airlines focused on using as little fuel as necessary.
Kinder Morgan blamed its canceled fuel shipment on an unnamed
refiner that couldn't keep up with higher-than-anticipated demand.
It also said the supply disruption in Phoenix was not as significant
as the airlines made it out to be and that the trouble at other
airports was partly the result of jet fuel being diverted from
California to bolster supplies Phoenix. Nevertheless, it announced
plans to spend $130 million to replace a 140-mile pipeline with a
larger one to move more fuel to Arizona from Texas and New Mexico
refineries.
Airports across the Southwest weren't the only ones struggling
with fuel supplies last month.
A handful of airports in Florida, most notably Orlando and Tampa,
saw their regular shipments cut off as a result of refinery and
shipping snags caused by hurricanes and tropical storms moving
through the Gulf of Mexico. Again, the airlines began bringing in
fuel by plane.
"We've been ferrying to Orlando for two weeks," Sturtz said. "It
just goes on and on."