Thursday, August 11, 2005

Airlines face fuel crisis

You thought you had it bad paying $2.83 a gallon? Just try being in the airlines shoes where a jet-fuel shortage is reminiscent of the gas lines of the 1970s!

Airports in California, Arizona, Florida and Nevada recently came within a few days — and at times within hours — of running out of jet fuel.

Because of supply bottlenecks, airlines were forced to fly in extra fuel from other markets and scramble for deliveries by truck.

But these are expensive, short-term fixes that do not address what airline executives consider to be the underlying problem: with passenger traffic rising above pre-9-11 levels, the nation's aviation business is slowly outgrowing the infrastructure that fuels it.

What started as routine supply tightness in these markets quickly snowballed following disruptive events that included a hurricane, a canceled fuel shipment and, ironically, the airlines' own efforts to prevent shortages, according to several airline executives.

Late July and early August were "unprecedented for Southwest for the number of cities where we've had to manage supply problems," said Glenn Hipp, director of fuel purchasing and inventory management at Dallas-based Southwest Airlines Co. AMR Corp.'s American Airlines, UAL Corp.'s United Airlines and America West Holdings Corp., also said there has been recent supply trouble.