Oil distiller problems hike up gas prices

Aug. 13, 2015
When BP's distillation oil refinery in Whiting encounters production problems, we all pay the price at the pump

If you live in the Midwest and you filled up your car's gas tank just two days ago, you probably paid 30 cents less per gallon, but today prices are a different story – a somewhat close to unaffordable story.

BP's refinery in Whiting, Ind., is facing problems with its largest crude distillation unit.

According to the U.S. Energy Information Administration's website, the refinery is the seventh largest in the U.S. and biggest in the Midwest. It has an operable capacity of 413,500 barrels per calendar day.

Reports say one of the three crude oil distillation units at the plant, was unexpectedly shut down on Saturday, August 8 for unscheduled work, and BP officials have not said when the repairs to the tank will be done.

The unexpected shut down sent shocks across the region and now everyone depending on gas will pay the price at the pump. Petroleum analysts predict the average gas gallon to increase from 30 cents to a dollar per gallon.

"Almost immediately, market gasoline prices shot up on the concerns of reduced gasoline supply from the BP refinery," Patrick DeHaan, senior petroleum analyst with said in a written statement and estimates a 15- to 30-cent increase.

Average gas prices have seen an increase from 1.9 cents to 11 cents (in Michigan) just in one day. The gas hike is expected to last until the end of the year.

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