Irving Oil refinery explosion leads to gas price hike
Gas prices will be reset on Thursday
CBC News
Posted: Oct 3, 2012 7:53 AM AT
Last Updated: Oct 3, 2012 10:26 AM AT
A minor explosion at the Irving Oil Ltd. refinery in Saint John caused prices for gasoline trading to jump in New York last week. (Irving Oil Ltd.)
New Brunswick gas prices are expected to jump by roughly five cents a litre on Thursday morning partly because of problems at the Irving Oil Ltd. refinery in Saint John.
Gas prices have fallen for two consecutive weeks but that is expected to come to an abrupt end this week when the Energy and Utilities Board resets its prices.
CBC reporter Robert Jones predicts gas prices will rise roughly five cents a litre on Thursday. The price could hit 140 cents a litre.
Trading in gasoline futures, which factor into the EUB’s weekly price-setting calculations, occurs at the New York Mercantile Exchange.
Irving Oil ships so much petroleum into the United States that traders at the exchange watch the Saint John-based company very closely.
Last week, news of a minor explosion at the Saint John refinery sent trading prices in New York soaring by 11.4 cents a gallon in one afternoon.
But the larger problem is Irving Oil's ongoing refinery maintenance, which is being conducted at the same time as two big exporting European refineries, including Shell's giant Pernis refinery in the Netherlands.
The maintenance of the three refineries is causing tightening of gas supplies and increasing prices along the east coast of the United States.
While gasoline will likely jump six cents a litre or more, diesel and heating oil likely increase by two cents a litre.
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