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Refinery Fire Stokes Fears Of Even Bigger Gas Price Hikes

Gas prices shoot up all along the West Coast and Canada. The average price of unleaded in Orange County is now $4.06.

Southern California gasoline prices, already topping an average of $4 per gallon, may climb at an even higher rate because of a major fire at a West Coast oil refinery, it was reported today.

The average price of a gallon of self-serve regular gasoline in Orange County rose today to its highest amount since May 26, increasing 1.3 cents to 4.063.

(Be sure to take a look at Patch's new feature that tracks the cheapest gas in town for you. It's under the blue Traffic & Gas tab near the top of the homepage.)

The Orange County average price is 19.8 cents more than one week ago, 33.9 cents higher than a month ago and 51.6 cents greater than a year ago. It has increased 30 of the past 32 days, rising 34.1 cents during that span, including 2.6 cents on Sunday.

The massive Cherry Point refinery near Blaine, Wash., owned by BP Arco, had a major fire Friday night. A key link called a "crude vacuum distillation unit" was so badly burned that BP experts had yet to approach it to assess damage today, according to an incident report filed with the federal government and obtained by the Bellingham Herald newspaper.

Loss of the crude processing unit leaves the refinery unable to take in its daily intake capacity of 230,000 barrels of crude oil, mostly from Alaska. Gas is refined and blended there to meet California's strict smog laws, and is shipped via tanker ships south to California.

A BP spokesman told the Bellingham newspaper that overall production at Cherry Point may be cut by half for at least the next few days, and possibly the next few months. The refinery can still produce gas or diesel using semi- refined oil stored on site, or feedstock from other sources.

West Coast refined market traders based in Los Angeles said wholesale futures prices here jumped 7.5 cents per gallon Friday afternoon on news of the Cherry Point fire. That price had already gone up 33.5 cents per gallon in one month, according to traders quoted by the Reuters business wire.

Wholesale gas prices also shot up all along the West Coast of the U.S. and Canada, as the refinery is virtually on the U.S.-Canadian border and sells fuel to wholesale markets from Vancouver to San Diego.

The bad news for drivers came as Southland gasoline retail prices cross the $4 mark last Saturday. The average gallon of unleaded went for $4.07 today in Los Angeles County, 51.4 cents greater than a year ago, according to figures from the AAA and Oil Price Information Service.

MayMom February 21, 2012 at 07:04 PM
There always seems to be a refinery fire when there is a political struggle. Amazing this one is a BP owned refinery. Check the record profits these oil companies are making. They certainly could be helping out the everyday consumer but you have to see who's pockets they are lining before realizing why they aren't. This is just another way to push the pipeline from Canada (full of dirty fuel). Hmm, I wonder, could it be that the Stock Market was showing good signs therefore the fear factor needed to come back out.
tinytom February 21, 2012 at 07:21 PM
Anybody with half a brain knows it's mostly b..st. Here's the thing, if your going to make a deal with a free market person and they want to shake on it, watch your wallet in your back pocket because they'll try to pick it with their other hand.
Nathan Anderson February 21, 2012 at 08:37 PM
Newport Beach
Dr. Zillman February 22, 2012 at 02:13 AM
I heard on the KNX business report that our overall gasoline use is down, AND we are for the first time EXPORTING gasoline to (guess where?) CHINA! Yes, we are all being "played." BIG TIME.
Alberto Barrera February 22, 2012 at 05:29 AM
The refiners are finding it more profitable to sell to foreign countries than to the domestic economy. Europe and China got very spooked when Lybia went up in flames, they lost a good amount of oil and American refineries certainly make more profits when gas is close to $8 a gallon in Europe.

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