On the second Sunday in May, Alberta Soloman rounded the corner of Florida Avenue and Sixth Street NE near her home.Driving a sputtering Plymouth sedan, she ran out of gasoline, cursed the times we live in, then coasted to a nearby Merit station - and into The Gas Crunch of 1979.
She found dozens of others already there.
In the weeks since, the lines at service stations have lengthened, and the price of a gallon of gas in some places has leaped over the $1 mark. The national frustration level is nearing a bursting point, and confusion over why this is happening to the richest country in the world has only deepened.
There is, of course, a sense of deja vu to all of this. This time, though, the pinch has come with greater vengeance than in 1973. "Fooled once, shame on you," the old saying goes. "Fooled twice, shame on me."
This time, too, the riddles seem more perplexing.Among the most puzzling aspects:
Why are there gas lines here and not everywhere? Any why are Washington's among the longest?
How can one service station be out of gas when the one next door is brimming with it?
Why are some stations charging 20 or 30 cents more for a gallon of gas than others?
Where does all that spot market oil you hear about come from? Where has all the oil from Alaska's North Slope gone?
And how, if oil is supposed to be the most regulated product in the United States today, can some people be getting rich off this crisis?
The answers to this questions add up to a tale of a system gone terribly awry.
For those who believe that the world belongs to the oil companies, there is much about this disaster that suggests a sinister conspiracy.
For those who believe in the inherent ineptness of government, there is much that suggests that federal and state officials have all done their part to aggravated matters.
The public has contributed as well. Examples abound of hoarding, as early as last fall, by businesses and others owning private tanks. Many motorists panicked at the first sign of gasoline lines and often joined the queues with almost full tanks to "top off."
The role played by the media in reporting the crisis has also come in for criticism. The line between passing on the news and inciting a panic is sometimes a fine one.
The only villian everyone seems to agree on is the Organization of Petroleum Exporting Countries (OPEC).
Few want to accept anything more than a simple explanation for the crunch. The polls show many holding fast to pet theories.
In addition, news reports circulate, and so do rumors: companies secretly dumping oil in the sea, tankers riding at anchor and intentionally delaying deliveries, storage terminals being drawn dry one month, then overflowing with fuel the next, government officials in cahoots with the oil companies, deliberately engineering the crisis in order to force adoption of certain energy measures.
But the story of how we got into this mess is really a mix of things - a combination of intended actions, grave miscalculations and gross bungling. It is the painful result of a rather complicated patchwork of self-interested decisions by the oil companies, compounded by poorly conceived - and often absurd - governmental rules, connfronting a stubborn and spoiled American public.
And the kicker is, the nightmare isn't likely to go away soon.
The story of the Gas Crunch is really two stories. The first one is international in scope and explains the worldwide crude oil shortfall. The second one tells how the crisis has been managed, and explains why the oil that's left has been distributed in the United States so inequitably - and why the metropolitan Washington area has been among the hardest hit.
Chapter one begins early last year when the oil companies - with the Department of Energy looking on - chose a riscky strategy of sharply reducing inventories, leaving the country with what turned out to be critically low supplies of crude oil and gasoline.
The strategy was followed because, in fact, U.S. oil companies then held too much oil. OPEC had gone nearly two years without raising world oil prices, and the oil companies, anticipating a boost in prices, had filled their storage tanks to the brim by early 1978.
As a result of this surplus, gasoline at the pump was selling in many instances at below its legally allowable profit magrins.
OPEC, though, had a surprise for the oil companies. It did not raise oil prices either in January 1978, or in May.
So the oil companies proceeded to imported less and began drawing down their inventories to reduce, they say, what had become the high inventory carrying costs.
Industry critics, however, maintain the strategy was designed to tighten the market and push up prices.
In any case, the nation's gasoline stocks slipped from 272 million barrels in January 1978 to 220 million barrels by June 1978. That marked the lowest level for the nation's gasoline stocks since August 1975, and inventories remained critically low for the rest of 1978.
Had everything gone according to plan, the oil companies might have gotten away with this strategy, and no serious shortage would likely have developed. But few things happened as planned.
The weather turned out to be unseasonably mild last autumn. The result: more road travel than normal - and moregasoline consumption - after Labor Day. When winter finally arrived, it came with a vengeance. Deliveries of heating oil soared.
To aggravate matters, the federal government in December made its largest transfer ever of crude oil to the Strategic Petroleum Reserve, the nation's stockpile of oil set aside for distribution only in the event of an emergency. In January, the government diverted another large shipment to the reserve.
Most important, Iran's revolution, which had been building during the fall, brought with it at the end of December a cutoff of Iranian oil exports.
Other OPEC producers showed little eagerness to make up the dirrerence. Dramatic gestures by President Carter and Egyptian President Anwar Sadat aimed at concluding an Egyptina-Israeli peace agreement had angered the Arab oil states. The Egyptian-Israeli treaty bardened their determination not to expand production.
By March, the world was hort roughly 1.5 to 2 million barrels of oil each day.
According to Energy Department figures, the United States was still receiving its "fair share" - roughly one third - of the world's shrunken oil supply. But the net effect of the global shortage had been to cut U.S. oil imports by about 5 percent over last years.
U.S. oil companies began announceing they were falling back on special allocation plans. In April, the curtailments deepened. Gas lines appeared in California at the end of the mouth. A couple of weeks later, The Gas Crunch of '79 reached Washington.
Now, a 5 percent drop in imported oil should hurt. But it should no cause the kinds of disclocations and turmoil the country has experienced in recent weeks.
A key riddle in the current crisis: How does a 5 percent reduction at the wellhead result in shortages of up to 30 percent at the pumps of Washington gasoline stations?
The answer can be found in the Energy Department's allocation plan - that vast system thousand pages, tell how the nation's scarce gasoline supplies must be distributed.
The plan was developed in 1974 but was not used extensively until the current crisis began four months ago. It has:
Created a huge class of priority users - including farmers, construction companies, private bus lines, trucking firms and others - who get gasoline ahead of ordinary motorists.
Diverted discproportionate amounts of gasoline from cities like Washington to small towns and rural areas, some of which are awash with more gas than they need.
Channelled extra gasoline supplies this summer to winter vacation areas like Hawaii, which don't need as much fuel this time of year.
Failed to adjust to changes that have taken place in travel patterns this summer. People aren't going to the summer places they used to go. Instead, they appear to be staying closer to home. But the gasoline is being distributed largely on the basis of where people went last year. As Energy Department Secretary James Schlesinger was overheard last week explaining the nation's allocation plan to President Carter, "What it does is to put the gasoline where the cars are not. It puts it in the rural areas where the people are no longer going."
Neglected to compensate for the fact that not all oil companies are created equal. Some have been affected more drastically than others both by the reduction in OPEC oil and by the government's allocation plan. Parts of Washington were especially short of gasoline last month because three of this area's major suppliers - Amoco, Texaco and Sunoco - were giving their dealers a smaller fraction of gas, compared to 1978 allotments, than were other oil companies.
Just how the government's allocation plan affects how much gasoline an oil company has available for its service stations can be seen clearly from Exxon's experience last month. Exxon's gasoline supply was down 2 percent from June 1978. But the company ended up giving its service stations only 78 percent of what they received in june 1978.
What happened was this: 5 percent of Exxon's 98 percent went directly to the states for use as an emergency reserve. The Energy Department ordered Exxon to give another 6 percent to weaker oil companies so that, in the words of one federal official, "they wouldn't go broke." The Energy Department frequently makes such special assignments. An additional 4 percent came off the top for distributors whose sales qualified them for an "unusual growth" allocation - a policy that tends to benefit stations in winter resort areas because it is based on gasoline sold from October to February. Finally, Exxon's new stations, under the allocation rules, siphoned off another 4 percent of the company's total supply. All of these factors seemed to conspire to make The Gas Crunch of '79 particularly severe for Washington.
Because the Washington area has few new service stations (the property rents here discourage starters) and because it has relatively few priority users, the area benefitted little from the Energy Department's special allocation provisions.
Area drivers had to scramble for the 78 percent Exxon's old service stations got.
Isn't the government's allocation plan, then, making the gas crunch in this area worse than in other parts of the country?
Some state officials certainly think so. Maryland sued the Department of Energy, charging that Maryland in June got only 78 percent of the amount of gasoline it received a year earlier, compared to a national average of about 90 percent.
A federal judge, however, rejected Maryland's claim Friday.
Energy Department officials maintain that regardless of distortions caused by the allocation plan, there is a rough justice in the total amounts of gasoline received by the 50 states.
"I think, fundamentally, we're trying to do the right thing," John O'Leary, the Energy Department's deputy secretary, testified recently. "But we may be trying too hard to fine tune the system."
Then, in a frank and telling moment, O'Leary added: "We aren't in the oil business. We are government bureaucrats."
Federal officials also suggest that if their management of this shortage has been less than perfect, there is plenty of blame to go ground.
State officials, they suggest, have been guilty of shortsightedness and clumsiness in dealing with the shortage.
The governors of Maryland and Virginia together with the mayor of Washington were slow in instituting an odd-oven gasoline rationing plan, waiting until mid-June to put it into effect - more than a month after California.
They were slow, too, to make wise use of their emergency reserves. In May for instance, the Energy Department gave the states the power to increase from 3 to 5 percent the amount of gasoline they got from oil companies each month for hardship cases. Maryland's Governor Harry Hughes and Virginia's Governor John N. Dalton failed at first to take the full 5 percent.
The two governors elected in June to take only 3 percent for their states, in effect returning millions of gallons of gasoline to the oil companies to distribute through other channels. The District of Columbia took the full 5 percent.
How the emergency supplies have been used has also raised serious questions:
In Virginia, though northern suburbs were crippled by gasoline shortages, state energy officials allocated reserves in a pattern that favored Richmond and some rural areas over the populous Washington suburbs.
In the District, energy officials in May assigned 4,000 gallons of their emergency reserve to the architect of the Capitol, who runs a private station for House VIPs as well as for the Capitol's police and maintenance force.
In Maryland, officials distributed about half of the state's 416 million gallon emergency gasoline supply for June to middlemen known as jobbers who claimed to serve farmers and businessmen located rural sections of the state. The jobbers' claims are unaudited and self-certified, and state officials concede they cannot be sure the special allocations ever reached their mark.
In fact, the presence of jobbers in the oil marketing chain has been a key factor in making management of this gas crunch particulary tricky. There are about 15,000 of these distribution middlemen in the country, and they have enormous flexibility in obtaining supplies of gasoline and heating oil.
Jobbers now get between 25 and 50 percent of the nation's gasoline, and experts say the quantity is increasing monthly. Sunoco representatives say priority customers and jobbers were getting only 6 percent of the company's supplies in March. They will be getting 20 percent in July.
Even now, the major oil companies are required to comply with most jobber requests for more gas.
Moreover, when a jobber loses a customer he once had, he is permitted to keep the extra gasoline and do with it what he wants. Often, this gasoline has found its way to the spot market where it fetches high prices.
This sort of system, said John Mills of Continental Oil Co., provides "the opportunity for the imaginative to manipulate the regulations to their own advantage."
If a combination of federal, state and oil company actions have added to the gasoline problems of the area, some of Washington's woes also have to be blamed on the luck of the draw.
Shell, as it happens, is one of the top three gasoline retailers in the Washington area, and its crude supplies are particulary short because some of the countries it normally imports from are refusing to honor supply contracts.
Amoco, another major Washington gasoline retailer, was crippled last winter by a string of refinery breakdowns, the worst in the company's history. Amoco was also hit paticularly hard by the Iranian cutoff. "We just haven't been able to catch up," said R.D. McMullen, Amoco's eastern regional vice president.
The supply situation here would be different, perhaps, were the Washington area luckly enough to have Standard Oil Co. of Ohio as a major retailer.
Because this company is less dependent on OPEC crude than some other oil firms, its overall supply is actually 13 percent above last year's. Standard Oil of Ohio intends to give this month as they received last July.
Examples of unevenness and inequities in the nation's gasoline distribution system run on.
What they add up to is the strong suggestion that The Gas Crunch of '79 is nearly as much a crisis of management as it is a crisis of supply.
Federal officials have promised to plug loopholes and repair deficiencies. But the Energy Department has changed the plan twice already this year. It undated the rules in February, issuing the new set with just a week's notice, thereby causing unexpected disruption in supplies. The rules were revised again two months later.
There is some speculation that the current plan will be scrapped altogether by Carter and replaced, perhaps, by a national coupon rationing system. Another, more unlikely, possibility would be the lifting and restoration of a free market. In this case, the price of gasoline would shoot up at least in the real term.
The point is, no one knows quite what to expect. That has been an important point all along. On top of the alrge uncertainty factor in world oil markets, the Energy Department has managed to add still more confusion.
In March, despite the beginnings of shortages in the United States, the Energy Department quietly suggested to U.S. refiners that they stay out of the high-priced world spot market for crude oil and refined products. But in May, after the crunch hit California, the department recersed itself.
In April, the department began urging refiners to build up heating oil stocks for next winter at the cost of gasoline shortages this summer. A month later, after gasoline lines appeared, the agency lowered its heating oil targets to allow greater gasoline production.
Federal officials maintain that most of their actions have had beneficial effects. Beyond that, they see in their changes of direction the virtue of flexibility.
But there is, at the same time, the recognition among some officials that the Evergy Department is ill-prepared and under staffed for its task.
The current shortage, for example, caught the department with its entire gasoline price enforcement staff virtually dismantled in anticipation of the decontrol policy the agency had been pushing for years.
And though the department has 20,000 employees and a budget of $10 billion, most of its efforts are still directed into projects other than managing the gas crunch. On 1,500 staffers were assigned to deal with the short age until the White House threw in another 400 fresh recruits last month.
In any effort, though, to fix responsibility for The Gas Crunch of '79, one inevitably comes back to the well - to OPEC and to the oil companies.
It is a fact that the OPEC countries produced less oil this spring than they were producing a year ago.
It is a fact that, even as imports dropped, U.S. oil companies reduced their domestic oil production last winter.
It is a fact that domestic refinery operating rates dropped to 84 percent for most of the winter and spring, which is lower than normal.
Industry spokesmen explan the dip in domestic production as a seasonal blip that was only barely more severe than normal. They explain the reduction in refinery operating rates as a conservative response to very uncertain conditions in supply. Under jaw-boning from the Energy Department, the rates have since risen to a more normal avergae of 89.
One of the few questions for which there is an easy answer is: What has happened to Alaska's North Slope oil that came on stream in 1977. More than 1.2 million barrels of it flows into United States daily. But other domestic sources of crude have dried up, and demand for oil has continued strong. The nation has fully absorbed what Alaska had to offer, and has been left still wanting more.
As for seemingly conflicting reports that have circulated of empty storage tanks and overflowing ones, it is difficult to know what to make of them. While many of these reports have been substantiated, it is hard to know what importance to attach to them since they have been a sort of snap-shot along a system that customarily exhibits large fluctuations from point-to-point.
Then, too, there has always been a problem of getting precise and up-to-date numbers about just what the oil companies are up to.
For the suspicious, perhaps the strongest argument suggesting that rigged the gas crunch - or at the least are not entirely unhappy to see it continue - is that the companies, some of the distribution middlemen and many retailers are getting rich off of it.
This leaves another big riddle, which is how the price of gasoline at the pump - up anuwhere form 33 percent to 50 percent since January - can have risen faster than the price of OPEC crude, particularly when gasoline is supposed to be price-controlled every step of the way. CAPTION: Picture 1, Measuring gas supples at a Falls Church station. By John McDonnell - The Washington Post; Picture 2, Reports circulate . . . of storage terminals being drawn dry one month, then overflowing with fuel the next. By John McDonnell - The Washington Post; Pictures 3 and 4, Gasoline lines appeared in California at the end of April. A couple of weeks later, The Gas Crunch of '79 reached Washington. by John McDonnell - The Washington Post