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5/8/2007 6:25:00 PM
March fire at Whiting's BP plant fuels gas hikes

Post-Tribune

When drivers across the nation agonized over a record $3.07 average per gallon at the pump this weekend, it was partly because of a March fire at the BP Whiting Refinery plant.

The refinery is one of the nation's largest and has been operating at less than full capacity since the fire on March 22. That contributes to a nationwide shortage in gas supply, oil industry analyst Trilby Lundberg said.

The plant normally produces about 420,000 barrels of oil per day. Tom Keilman, spokesman for BP Whiting, wouldn't say exactly how much production is down but acknowledged the fire puts a squeeze on drivers' wallets nationwide.

"We are operating at reduced rates currently. That is attributable to an unplanned outage we had at the refinery. We had an incident on one of our units that removes sulfur out of the fuel streams for our gasoline production. That's one of the reasons we've seen reduced inventories in the Midwest," Keilman said.

The damaged unit is being repaired. After some other planned maintenance this spring, the plant should be up to speed in a few months.

"We expect it to be some time later this summer. It depends on a variety of activities," Keilman said. "They're doing everything they can to get back to operating capacity."

The Whiting refinery is among at least a dozen partial plant shutdowns in the United States and internationally that cut refining capacity and increased prices, Lundberg said. The outages have been reflected in weekly government data that has shown gas inventories falling during a season when most analysts think they should be rising.

Analysts worry refineries won't produce enough gasoline to meet demand when summer driving begins on Memorial Day weekend.

Gas prices have climbed by 19.5 cents over the past two weeks, according to Lundberg.

Analysts say inventory fears can only go so far in pushing up the price. But because retail prices generally lag the futures markets, consumers could still pay more as futures prices drop.

The Associated Press contributed to this story.

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Copyright 2015, Chicago Tribune




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