SoCal refinery fire, Martinez Tesoro strike could impact gas prices

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Thursday, February 19, 2015
SoCal refinery explosion, fire could impact gas prices
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Analysts say the Exxon Mobil refinery fire in Southern California and a strike that shut down the Tesoro plant in Martinez will result in rising gas prices.

SAN FRANCISCO (KGO) -- It's probably early to say what effect an explosion at a Southern California refinery will have on the state's gas prices. Four workers suffered minor injuries in the blast at the Exxon Mobil plant in Torrance, near Los Angeles on Wednesday morning. A gasoline processing unit that was just recently installed was badly damaged.

We've already seen gas prices in the Bay Area rise about 25 cents in the last month. And now experts warn that prices could go up another 20 to 40 cents a gallon. Some of the factors include whether or not that Torrance factory can be reopened and whether a strike that's closed down a Martinez refinery will be longlasting.

Drivers already are bracing for higher prices. They've seen them rise rapidly the past couple of weeks, but it's not as bad as a year ago.

"Yeah, last year it was painful," said San Jose State student Nia Jones. Even this year with all the increases, she notes that it's not as bad as it was before and is tolerable.

PHOTOS: Explosion at Exxon Mobil refinery in Torrance

The price of crude has gone up $8 to $10, driving up the price of gas about 20 cents. But the Exxon Mobil refinery fire in Torrance and a strike that has shut down the Tesoro plant in Martinez are going to reduce supplies an estimated 16 percent.

Petroleum analyst Allison Mac at says plant maintenance tied to the changeover to the summer gas blend will also have an impact.

"A lot of the refineries have shut down for maintenance, causing production and the supply to be lower, and which is why prices have gone higher," she said.

Gas prices on Wednesday were up about 2 cents a gallon from Tuesday in the three major Bay Area cities. Up about 12 cents compared to last week, and up 25 cents from a month ago in San Jose and Oakland. The exception is San Francisco, where gas prices are up 16 cents from last month.

VIDEO: SoCal Exxon Mobil refinery damaged after explosion

"The concern we have is that two refineries in California have gone down that control 16 percent of the gas supply in the state," said Consumer Watchdog President Jamie Court. "And as a result, gas prices will go up."

San Jose resident Antonio Trejo is disappointed.

"It was finally getting a little comfortable to go out and have some family adventures and go out and have some fun," he said. "And with the gas price going back up, especially my truck is a little bit of a gas guzzler, I'm going to think twice about starting to go out and have fun again."

Analysts predict prices to peak in April or May.

For full coverage on gas prices, click here.