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Page added on January 29, 2009

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Deadline looms for refinery labor deal

NEW YORK: As many 24,000 refinery workers could walk off the job from the Gulf Coast to Montana with a labor contract expiring at midnight Saturday, potentially disrupting the production of gasoline, diesel and chemicals.

A strike by unionized oil workers could affect about 60 producers including Exxon Mobil, Valero, Royal Dutch Shell, BP PLC, and Chevron, according to the United Steelworkers union, which represents them.

The impasse comes at a time when demand for gasoline, chemicals and other products made by refineries has evaporated, however, which could cost the union leverage.

Between November 2007 and October, Americans drove 100 billion fewer miles, the largest continuous decline in driving the nation has ever experienced. Refineries began shutting down for maintenance early this year as the market continues to tighten.

“A strike threat would be particularly ill-advised under current market conditions as refiners would presumably be better prepared to sit out a work stoppage than any time in recent memory, and striking workers might even be doing the industry a favor,” said Antoine Halff, an analyst with Newedge Group.

International Herald Tribune

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