Fuel Crisis Report cont'd...

CRITICAL INFRASTRUCTURE IMPACTED

The fuel price protests exposed the interdependencies of practically each CI sector of the UK economy on continuous fuel supply and resulted in direct and indirect impacts on CI in the UK.

Direct impacts of the protests included the widespread disruption of the energy sector caused by the blockade of oil refineries and fuel depots, and the interruption of the transportation sector as a result of drivers going on strike, "go-slow" demonstrations on highways and roads as well as the fuel shortages in gas stations.

Several CI sectors, including health care, food distribution, finance and government, demonstrated their dependency on energy and transportation sectors. The financial impact of the week-long fuel drought was estimated to top £1 billion.

Energy Sector

The energy sector was the most severely affected CI sector by the fuel price protests because access to gasoline was used as leverage by protestors in bargaining with the UK Government. Protestors organized a national blockade of oil refineries and distribution depots. After five days of protest, six of Britain's eight refineries were blocked, and tankers could not leave oil refineries and fuel depots to transport gasoline to stations where it could be distributed.

Gas stations did not have large gasoline reserves, relying on a system of just-in-time delivery, and were unable to distribute fuel in the absence of tanker deliveries. This system relied on tanker deliveries to individual stations, up to three times a day, depending on the volume of fuel sold at each location. As such, the availability of gasoline at stations was highly vulnerable to disruptions in the supply chain.

By September 12, about half of Britain's petrol stations were shut down, and those with remaining fuel stocks started to ration purchases. The impact of fuel shortages quickly threatened to spread to other CI sectors (such as transportation, health care and government) through significant fuel interdependencies -- the cascading effect on these sectors will be described in the following sub-sections. Recognizing the real and potential impacts in these areas, the Privy Council authorized the Department of Trade and Industry to order oil companies to deliver gasoline to 298 priority stations across the country.

The government further stipulated that a number of industries and services were eligible for priority access to fuel at these locations. When the fuel blockades were lifted on September 14 and tanker deliveries recommenced, the limited supply was allocated on a priority basis to these essential services until at least September 16. The UK Petrol Retailer's Association said that resupplying empty stations presented "a massive logistical problem," and fuel companies warned that it would be weeks before the situation at gas stations returned to normal.

Transportation

The transportation sector was disrupted through direct and indirect means. The direct impact of "go-slow" demonstrations resulted in temporary traffic delays on major highways and city roads. Striking truck and taxi drivers caused disruptions by removing their vehicles from the service. The most severe impacts were caused by the sector's reliance on gasoline, with both private and public transportation systems being interrupted by the lack of fuel.

Reports suggest that 29 percent of private motorists were forced to stop driving because they did not have gasoline. In turn, public transportation systems were strained by fuel shortages and an increase in the number of passengers. The London Underground experienced overcrowding as the number of users increased up to five percent on the three-million daily norm.

Some train services in London were cancelled after fuel depots ran dry. Several London bus companies were forced to substantially cut their services because of the lack of fuel and because drivers could not get to work (18). Even when fuel deliveries started on September 14, bus companies across the country restricted their passenger services to conserve dwindling fuel stocks and warned that these measures could stay in place for several days.

Health Care

The National Health Service (NHS) was principally impacted by its reliance on the transportation of staff, patients and supplies. The disruptions in gasoline supply affected the ability of some medical staff to use their usual means of transport to get to work, which resulted in medical staff shortages.

Hundreds of gas stations across the country set up piecemeal local rationing schemes, often supervised by the police, and tried to conserve limited fuel supplies for medical personnel. These measures were ineffective and several hospitals around the country were forced to cancel routine operations and to limit admissions to emergency cases only.

Ambulance services were disrupted by shortages of gasoline and limited to calls from patients in need of serious assistance. Ambulance crews in some areas were instructed to keep their speed below 34.2 km/h on all non-emergency responses to save fuel. Many operators instructed their staff to respond only to emergency calls. One media report noted that ambulance services in Surrey could not respond to emergency 999 (911) calls while they waited to receive extra supplies of gasoline. There were conflicting reports about the extent to which shortages of fuel impacted the ability of vehicles to transport supplies to hospitals. Government, Ministry of Health and some media sources tended to stress that the protests were having a negative impact on the NHS.

Reports emphasized low reserves of food stores for hospitals in the West Midlands, medicines at pharmacies in Portsmouth and blood stocks in the Eastern NHS region. It was also reported that some hospitals were unable to remove hazardous clinical waste from their facilities, creating a public health risk, and that the Royal Hull Hospital had run out of stitches for operations. On September 13, the Prime Minister told protesters that they were putting "lives at risk" by depriving essential services, and the government placed the NHS on "red alert" for the first time in 11 years.

This measure instructed all local health services to implement emergency readiness plans, which enabled them to cancel regular services at a moment's notice in order to treat emergency cases only. The NHS remained on red alert and normal health care services did not resume for several days after the lifting of the blockades. While there is some debate as to the extent of the impact on health services, it is clear that the NHS incurred organizational and financial costs as a result of disruptions in the transportation sector. The cancellation of elective and non-emergency surgeries and procedures created a significant backlog, which would take the NHS a significant period of time to process. Additional financial costs involved housing accommodations for essential staff in hotels, expenses for cancelled and rescheduled procedures, and for using outside suppliers for essential goods. The Department of Health said that it was impossible to quantify the cost of the fuel crisis, but experts contend that it ran into millions of pounds.

Food Distribution

Two factors reduced the availability of food for distribution during the fuel crisis.

First, disruptions in the transportation sector prevented the shipment of food goods from producers to vendors. Similar to gasoline distributors, supermarkets rely on daily just-in-time deliveries rather than maintaining large stockpiles of goods. This mode of business proved to be highly vulnerable to transportation disruptions as there was very little stock to meet consumer demand when the supply of just-in-time goods was interrupted. Each day of the fuel protests further affected food deliveries, depleting the small reserves kept by supermarkets.

The second factor influencing shortages was increased demand and panic buying. The uncertainty of how long the fuel protests would disrupt food supplies caused consumers to alter their normal purchasing behaviour and attempt to acquire more goods than usual. The grocery chain Spar noted that its food sales had increased by 300 percent (28). The sight of empty shelves triggered some consumers to stockpile goods in sufficient volumes to endure a prolonged food supply shortage. Hence, by September 13 panic buying had commenced across Britain, some shops were bare of bread and milk, and a number of supermarkets began rationing food purchases.

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