[wolfcreek]

There have been black markets in my area just due to the high price. People stealing gas who have a regular costumer base. People stealing farm diesel from irrigation systems.

Fact is, you're gonna have black markets to some extent.

When we hear about the gloom and doom possibilities every time a storm develops, you start thinking it's a ruse.

[businessprofessor]

Stealth seems different than a black market. The price makes a strong incentive to steal. Those holding gasoline inventory have a strong incentive to protect their property also. If the price of gasoline is fixed, the black market situation will explode. Individuals will buy at the fixed (below market price) and sell at the market price.

Price controls may be a reasonable response on a short term energy supply disruption. The price controls must be accompanied with a tight system of rationing. Otherwise, gasoline will only be available through the black market effectively subverting the price controls.

There may been false alerts on supply disruptions in the past. This situation looks like a real supply disruption. Gasoline usage will need to decline in the short run. I am not sure about the best way to achieve the decline.

It would be best if everyone can plan in advance about the need to reduce gasoline usage. However, I anticipate a chaotic situation in which gasoline supplies are suddenly disrupted. This situation will be partly due to panic and politicians flaming against oil companies to whip up public sentiment. I expect the rats to seize on this opportunity to create an ugly situation.

This supply disruption exposes a big vulnerability: the concentration of refining capacity in hurricane alley. This situation is well known but there is no action to change it. Perhaps conservatives can press the issue now. Developing domestic sources of oil would be a good incentive for new refineries outside of hurricane alley. We need government action to overcome the NIMBY and green obstruction of refinery development.