« Banks, Lenders Extend Sandy Assistance to Homeowners | Main | How Did the US Economy Look on Election Day 2008? »

Gas Going for $20 a Gallon on Black Market after Sandy

Altrendo Images/Thinkstock(NEW YORK) -- Opportunists looking to profit from superstorm Sandy are advertising gasoline for as high as $20 per gallon on the black market after the storm crippled the ability for some tankers to pump gasoline and deliver it to stations in the Northeast, many of which are still powerless.

A former insurance adjuster who now works as a contractor in Brooklyn told ABC News he stocked up on 500 gallons of gas before Sandy hit. He has since sold his entire inventory.

"I was able to sell everything for $11 a gallon. I probably could have gouged people for twenty bucks and they would have paid it," he said.

Handfuls of advertisements have popped up on Craigslist offering gas at prices as high as $20 per gallon and empty gas cans, which are scarce, at prices ranging from $40 to as high as $500.

New York Attorney General Eric Schnedierman announced Monday his office is investigating post-Sandy price gouging after receiving a slew of complaints. However it remained unclear if any of the cases would be prosecuted or whether private individuals looking to cash in could also face prosecution.

ABC News found the Brooklyn contractor through an advertisement on Craigslist in which he offered to sell empty five gallon gas cans for $40 apiece.

"I don't need to hear that I'm a crook. People should have been prepared," he said. "I had some people irate and mad but they [have] got to understand I saw what happened in Katrina and Rita. Even though they have these federal agencies, you've got to be ready on your own. You can't depend on nobody."

In the six days since Sandy wreaked havoc on the northeast, long lines -- some of them several miles long -- have snaked through the streets as desperate motorists wait for hours to pump the limited available supply of gasoline into their vehicles.

Price gouging laws are being enforced to prevent gas stations and other stores from profiting off the emergency. In New Jersey, state law prohibits retailers for raising prices more than 10 percent in the 30 days following an emergency.

It was unclear whether the Craigslist sellers were exempt from the law; however there was plenty of distaste for their scheme to cash in on a disaster.

"I would have to say that it's probably capitalism at its worst," said Sal Risalvato, executive director of the New Jersey Gasoline-Convenience-Automotive Association.

He said although there are always "a few bad apples" out there, he was proud that members of his association, who have taken a hit at their stores, have remained honest and not raised prices.

"We can expect more deliveries but it's going a lot slower than I hoped it would," Risalvato said, of the effort to restore power to tankers and gas stations.

Despite the black market, Risalvato said this is a delivery problem and not a shortage.

"There's no need to panic [people] anymore. We can all go swimming in how much gasoline there is," he said, pointing to the downward pressure in prices.

New Jersey Gov. Chris Christie signed an executive order Friday night to ration gasoline for cars in 12 New Jersey counties after more than half the stations in New Jersey and Long Island shut down because of the storm, resulting in hours-long lines for customers and threatening a gas availability shortage.

Under Christie's order, car owners with odd numbered license plates can get gas on odd days, and car owners with even numbered license plates can get gasoline on even days. If one's license ends with a letter, Christie said it would be regarded as an odd number.

Despite the measure, the governor said on Sunday that he could not prevent people from topping off their nearly full gas tanks.

"You can't legislate selfishness," he said.

New York Gov. Andrew Cuomo said on Sunday the delivery problems were a temporary issue, "but that does not mean there will be a total alleviation of the problem in the immediate future."

First responders were given free fuel by FEMA, the Federal Emergency Management Agency. FEMA said it also sold gasoline to filling stations in some places.

Copyright 2012 ABC News Radio

ABC News Radio