Refineries are so… southern:
Gasoline prices, rising quickly across the country, could increase even faster in New England over the next year because of the shutdown of three refineries that serve the Northeast and the likelihood that another could close in the summer.
Economists estimate that the loss of these plants, which account for at least half of the East Coast’s refining capacity, could boost New England gas prices by as much as 15 cents per gallon – over and above increases driven by unrest in the Middle East and other global factors. The additional price increases would result largely from added costs of transporting fuel from Gulf Coast or overseas refineries.
The price of diesel and heating oil, which also are refined at the facilities, could rise as well.
“You don’t have refineries in New England, you don’t have pipelines,’’ Felmy said. “You’re really an island.’’
Yeah, but why? Why have our elected leaders left us here on a very cold, very expensive island?
Refiners are shutting plants after losing billions of dollars in recent years due to a combination of factors. The weak economy lowered demand for gasoline, tighter environmental regulations raised costs, and increased global competition squeezed profit margins.
In the last six months, oil production companies Sunoco Inc. of Philadelphia and ConocoPhillips Co. of Houston have each closed a Pennsylvania refinery and put it up for sale – with few potential buyers emerging – as they exit the refining business. Hovensa LLC, a refiner in the US Virgin Islands, closed a refinery on St. Croix that primarily supplied the East Coast.
Meanwhile, Sunoco also has put up for sale a facility in Philadelphia that accounts for about nearly one-fourth of East Coast refining capacity. Sunoco, which says its refining business has lost nearly $1 billion in the past three years, plans to shutter the Philadelphia refinery in July if no buyer is found. “We could stay in the refining business and put the entire company at risk,’’ said Thomas Golembeski, a Sunoco spokesman, “or we could exit the refining business and stop the financial losses.’’
New England has no refineries of its own to take up the slack. Gulf Coast refiners have extra supplies to offset the loss of production in the Northeast, but pipelines that carry gas, diesel, and heating oil from the Gulf Coast to the region do not necessarily have capacity for the additional volume, according to an analysis released last week by the Energy Department.
Why is refining gasoline and heating oil economically viable on the Gulf Coast, but not the Atlantic coast? The article doesn’t say, and makes only one mention of “tighter environmental regulations”. But if closed refineries leave us on an island, I want to know why we’re there.
Instead, we get this:
With gas prices rising steadily in recent weeks, Governor Deval Patrick has directed state inspectors to step up efforts to ensure that gas stations are not engaged in price gouging, false advertising and other deceptive practices, state officials said Sunday.
“We want to get ahead of the curve here,” Barbara Anthony, the state’s undersecretary of consumer affairs and business regulation, said in a phone interview. “We want to make sure that no one’s even thinking about price-gouging.”
Anthony said that while nine inspectors perform regular audits of gas stations to ensure compliance with state regulations, Patrick has asked for increased oversight in light of recent price hikes nationwide.
In a statement, Anthony’s office cited data from a AAA report showing that gasoline prices have risen for 11 consecutive weeks, and that Bay State drivers are currently paying $3.73 per gallon on average, up from $3.30 at this time last year.
The averages for other New England states on Sunday were $3.99 in Connecticut, $3.84 in Maine, $3.80 in Rhode Island, $3.81 in Vermont, and $3.71 in New Hampshire, according to AAA.
Stop your grandstanding, Deval. Our gasoline is cheaper than most of the rest of the region—and way cheaper than California’s. The price is going up nationally because your big brother, Barack, wants it that way.
You could do us all a favor and offer incentives to the oil companies to reopen the local refineries before prices spiral into the $4 and $5 range, but something tells me you’re not going to do that.