Oil pipeline spill could affect local pump prices

Gas prices did not change overnight at Kwik Fill in Corry, but a closed pipeline could see customers paying more at the pump for gasoline supplied by United Refining Co. of Warren. Journal photo by Maryann Mook

WARREN — A closed oil pipeline in Michigan could eventually affect gasoline supplies and pump prices in Pennsylvania and western New York state, according to Warren-based United Refining Co.

United Refining Co. Vice President and General Counsel John Wagner said no shortage has yet materialized; but if there is a shortage, it could affect consumer prices.

“The pipeline remained closed this morning,” Wagner said today.

And pump prices remained unchanged in Corry this morning at $2.849 a gallon of unleaded regular.

United Refining Co. in Warren supplies gas to Kwik Fill and Country Fair stations in Corry, Union City, and other locations in northwestern Pennsylvania.

Wagner said company officials are planning for no shortage and no increased prices. He said, though, the rejected plan raises the prospect of that situation.

The oil pipeline spill near Kalamazoo, Mich., has diminished the oil supply to United Refining Co.

Workers had completed repairs to the pipeline owned by Canadian-based Enbridge, Inc. as of Wednesday, according to a press release issued by John Catsimatidis, chairman and CEO of United Refining Co. in Warren. However, he said the U.S. Department of Transportation serves as regulator and will give permission to get the pipeline up and running again.

“The refinery located in Warren receives a large amount of its crude oil through this pipeline and has recently had to temporarily scale back production because of the break,” the press release stated.

Catsimatidis said it’s important, especially at this time of the year, to get the pipeline restarted.

“It is imperative to get this oil pipe line up and running again,” Catsimatidis said. “We are entering the final days of summer vacations and the prospect of gas shortages, empty pumps and gas lines is not a pretty prospect for northwest Pennsylvania and western New York.

“We sincerely urge both Enbridge and the governing U.S. agencies, the Department of Transportation and the Environmental Protection Agency, to get this pipeline up and operating as quickly as possible. Reserves are in short supply,” he added.

Wagner said once officials know the restart date, they can plan accordingly. Until then, he said officials have no way to positively predict the spill's effect on prices.

In addition to a possible shortage, Wagner said the availability of oil supplies from neighboring areas would factor into potential price increases. In response to the unplanned spill, Wagner said suppliers have made up the difference above their normal production.

Since the spill two weeks ago, United Refining’s Warren refinery has processed between 35 and 40 percent less oil. As a result, the geographical area has less to work with.

The company has the ability to import gasoline from outside areas such as Rochester, N.Y., and east Ohio, and does exercise those options on a stoppage basis.

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