Oil Workers in U.S. on First Large-Scale Strike Since 1980
Here we go again!
Any comments on how this will end?
Oil Workers in U.S. on First Large-Scale Strike Since 1980
Isn't this a bad time to be asking for a raise in the oil patch?The USW asked employers for “substantial” pay increases
kublikhan wrote:Isn't this a bad time to be asking for a raise in the oil patch?The USW asked employers for “substantial” pay increases
Oil boomtown: 'We could see 20,000 layoffs by June'
The United Steelworkers union, which represents employees at more than 200 U.S. oil refineries, terminals, pipelines and chemical plants, began a strike at nine sites on Sunday, the biggest walkout called since 1980.
Low Oil Prices Lead To U.S. Refining BoomWhile consumers may rejoice at gasoline prices dropping, one sector of the oil and gas industry is also seeing the benefits of low oil prices. Thanks to the oil glut in the U.S., demand for refining has grown massively, with many refineries running at over 90% capacity thanks to oil reaching prices not seen for five years. US refining capacity has reached approximately 17.8m b/d, an increase of 400,000 b/d from two years before.
In addition to the benefits of cheap oil, many refineries are located strategically near export terminals which facilitate the cheaper export of refined petroleum products. The continuation of the long-standing ban on U.S. crude exports, while bad news for U.S. shale producers, is good news for refiners especially those located near key US shale plays. One such company, Valero, is adding refining units.
ROCKMAN wrote:"...with many refineries running at over 90% capacity thanks to oil reaching prices not seen for five years.". Yes...refineries running at high capacity. It's difficult to not make this sound patronizing but I don't know how to avoid asking the obvious: how do refineries generate cash flow and profits? Simple answer: selling refined products, principally motor fuels in the US. And that revenue is generated by selling X gallons at $Y/gallon. And how has $Y changed recently? In the last 7 months gasoline prices have fallen 44% and diesel has dropped almost 30%.
Valero said its refining segment's throughput volumes averaged 2.8 million barrels a day in the fourth quarter, an increase of 41,000 barrels a day from a year earlier. Operating income in the refining unit grew to $1.9 billion from $1.5 million a year earlier. However, excluding special items, operating income was flat from the year before.
In the ethanol segment, operating income fell 49% to $158 million, due to the impact of lower gasoline and ethanol prices, despite stable corn prices.
Refineries to Rely on Automation Amid StrikeA strike that began in nine of the nation’s refineries yesterday isn’t likely to have much effect on fuel production at the plants. It will probably hurt refiners even less than the last strike 35 years ago, which also had a negligible impact on operations. In 1980, the last set of major strikes at U.S. oil processing plants, production of gasoline and diesel was not significantly affected.
“Refineries are highly automated operations that should be able to run with minimal disruption in the initial days and weeks. Strikes are not new to the industry and a combination of non-union management and contract workers will be called in to maintain operations.”
“They’re more automated now than in the 1980s. I have every confidence that things will go relatively smoothly. Operators may not push their plants as hard in this environment, but they can keep them running without too much difficulty.”
Shortly after talks between union and oil company representatives ended on Friday night, the union notified Motiva Enterprises [MOTIV.UL] of a strike by its members at the company's 600,250 barrel per day (bpd) refinery in Port Arthur, Texas.
The USW also gave notices on Friday of strikes to begin in 24 hours at Motiva's 235,000 bpd Convent, Louisiana and 238,000 bpd Norco, Louisiana refineries and the Shell Oil Co chemical plant in Norco, the union said.
"The industry’s refusal to meaningfully address safety issues through good faith bargaining gave us no other option but to expand our work stoppage," USW International President Leo Gerard said in a statement.
If no agreement is reached between Shell and the USW by early Sunday morning, a total of 6,550 workers at 15 plants, including 12 refineries accounting for 18.5 percent of U.S. production capacity, will be walking picket lines in the largest national refinery strike since 1980.
Personal friendships are turning sour as some workers cross picket lines in the lingering U.S. refinery strike, with companies pushing laborers to return to work by saying they could lose their bonuses.
A month into the biggest U.S. refinery walkout in 35 years, money is tight as strike pay from the United Steelworkers union is a fraction of normal wages.
About 6,550 workers are on strike at 15 plants, including 12 refineries with a fifth of U.S. capacity. Companies are relying on temporary replacements to keep plants open.
Up to 70 employees, out of 800, at Royal Dutch Shell Plc's Deer Park, Texas, refinery have decided to return to work, prompting feelings of betrayal, sources with knowledge of the situation said
ROCKMAN wrote:it was reported that USW Local 13-1 union officials turned off their fax machine in an attempt to stop workers from exercising their right to resign and return to work.
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