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Raccoon takes out Exxon refinery. Gas prices (and Exxon profits no doubt) spike to new record high

Charles Langley's picture
Posted April 3rd, 2007 by Charles Langley

The following story, reported by Erwin Seba of Reuters stretches the outer limits of credulity by asking the reader to believe that an opossum and a raccoon (plotting together no doubt), managed to sabotage two of the nation's largest gasoline refineries in Los Angeles.

What the the story (see original here) fails to mention, is that in California, oil refineries make tremendous profits by keeping supplies tight. And if they can't do it through inventory management, they can always export the surplus overseas, or simply shut down a refinery to restrict supply (see also my Commentary from February 26, 2007 titled "Gas inversion means price perversion").

Animals trip L.A. refineries, boost gasoline prices

Mon Mar 5, 2007 10:46PM EST

By Erwin Seba

HOUSTON (Reuters) - A raccoon and an opossum separately set off electrical power disruptions at two Los Angeles-area refineries on Sunday night and Monday morning, boosting gasoline prices on the U.S. West Coast.

Wholesale gasoline prices jumped 7 cents in the Los Angeles market at word of the upsets on Monday morning.

An opossum in a Southern California Edison commercial customer substation and a raccoon in a Los Angeles Department of Water and Power substation upset power supplies to the refineries within an hour of each other late Sunday night.

The Southern California Edison substation in Torrance tripped off-line at about 9 p.m. PST on Sunday (0500 GMT Monday), spokesman Tom Boyd said. The opossum's carcass was found by workers at the substation.

Exxon Mobil Corp.'s 150,000-barrel-per-day (bpd) Torrance refinery lost power at about that time, setting off a two-hour disruption in operations, said spokeswoman Carolin Keith. The company was back at planned production on Monday morning.

At about 10:20 p.m. PST Sunday, a Los Angeles Water and Power substation in Wilmington, California, switched offline, cutting power to a Shell Oil Co. refinery for about 10 seconds, said the utility's spokeswoman Kim Hughes.

A dead raccoon was found in the substation, Hughes said

 

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