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Cars wait in long lines at a Sunoco gas station on the Garden State Parkway in Montvale, N.J.MIKE SEGAR/Reuters

New York taxi and car service companies started pulling vehicles off the road on Thursday as the fuel crunch deepened, with the vast majority of storm-hit service stations in the greater New York area now out of gasoline or without power.

Outages and fuel shortages have forced many gasoline stations to shut, and now threaten efforts in New York and New Jersey to get back to business after Hurricane Sandy.

Large numbers of homes and businesses that have lost power are also reliant on gasoline- or diesel-run generators, including many of the Wall Street banks in lower Manhattan.

"We've had to cancel a lot of cars today because there's not enough gas," said Joue Balulu, a partner at Fone-A-Car in Brooklyn.

"It's affecting everybody. Our drivers have to go out to try and find gas."

Much of lower Manhattan remains without power after an explosion at a Consolidated Edison Inc. substation on the East River during the storm. Con Edison said on Thursday it could be another two days until electricity is restored.

Across New York's five boroughs and the northern suburbs of Westchester, Con Edison said 659,400 homes and businesses still had no power.

"In New York City over 50 per cent of service stations are not able to sell gasoline and it could be up to 75 per cent," said Ralph Bombardiere, executive director of the New York State Association of Service Stations and Repair Shops.

"New York City [gasoline delivery] terminals have power problems. For the individual stations, if they have product they don't have power and many, if they have power, don't have any product."

In Manhattan, police helped to monitor cars at a Hess Corp. garage on 10th Avenue and 44th Street to stop people cutting in line.

Zipcar Inc., a car-sharing company that rents out vehicles at an hourly or daily rate, said members late in returning cars in New York because of traffic or fuel shortages would not face the usual charges.

"Any members who are willing to wait in line for fuel, we're willing to waive any late fees," said Dan Curtin, Zipcar's vice-president of fleet operations in Boston. The firm is offering members in New York and New Jersey discounts until Friday.

On Wednesday, New York City Mayor Michael Bloomberg said he would restrict car traffic coming into Manhattan to vehicles carrying three or more passengers until Friday in an attempt to cut congestion in the city.

The New York City Metropolitan Transportation Authority, which on Thursday restarted a limited subway service, said it had supplies to keep its buses running.

"We are not having any issues with fuel at this point," MTA spokesman Kevin Ortiz said. "We are still getting deliveries of fuel to our depots."

The MTA has its own fuel tanks, but it is unclear whether it will be able to receive new supplies as many terminals and refineries in the region suffered storm damage.

In New Jersey, power company Public Service Enterprise Group Inc. said 780,000 homes and businesses were still without electricity, about 35 per cent of its customers, down from 1.7 million affected at the peak. On Wednesday, gasoline retailer associations said more than 80 per cent of service stations in New Jersey were shut.

At 8 a.m. EDT on Thursday on Route 18 in East Brunswick, N.J., a Hess facility was the only gas station open for miles. A line of more than 100 cars waited in the highway's southbound left lane, while dozens of residents on foot lined up on the sidewalk, holding plastic gas cans.

Fuel supplies into New York and New Jersey are being choked off in several ways: two refineries that make up a quarter of the region's gasoline and diesel capacity are idle because of power outages or flooding; the New York Harbour waterway that imports a fifth of the area's fuel is still closed to traffic, and major import terminals are damaged and powerless.

The main pipeline bringing gasoline and diesel from the U.S. Gulf Coast refining hub, which pumps 15 per cent of the East Coast's fuel, also remains shut.

In Hoboken, a N.J. town on the Hudson River, gas has become an especially precious commodity since it can be used to power the pumping of sewage water out of basements and homes.

At one building, a resident went door to door until she found a neighbor willing to siphon gas from his car to fuel the pumps.

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