Analyst: Shutdown could increase gas prices - Hawaii News Now - KGMB and KHNL

Analyst: Shutdown could increase gas prices

HONOLULU (HawaiiNewsNow) -

When a massive fire forced Chevron Corp. to temporarily close its Richmond, California refinery last year, gasoline prices soared by more than 50 cents a gallon in just three days.

Experts who track gasoline prices for consumers say that Hawaii will be more vulnerable to these kinds of price spikes in the wake of the shutdown of the state's largest refinery.

"This is just going to be another thorn in the side of motorists who don't' have as many options as to what kind of gas they're going to be filling up with," said Patrick DeHaan, senior petroleum analyst at

"One less refinery in Hawaii will mean more pricing volatility. It may not be something you notice all the time but when something does happen it's going to put pressure on prices."

The closure of Tesoro's 94,000-barrel per day plant will leave Hawaii with just one refinery, Chevron Corp. 54,000-barrel per day Kapolei complex.

Tesoro plans to convert its refinery so that gasoline retailer can import gasoline into the state to make up for the loss.

State officials and gasoline station operators maintain that any disruptions will be minimal since there's a glut of petroleum products that could be shipped into Hawaii.

They add that big customers like Hawaiian Electric Co., the Department of Defense and the large commercial airlines say they won't see much impact because they have long-term supply contracts or get their fuel elsewhere.

"I think the affects of the refinery are probably and should be very minimal because shipping gasoline around the world is so simple and efficient these days," added former Chevron station operator Frank Young.

But DeHaan says that will likely add cost to local gasoline prices, which are already the highest in the nation.

And if Chevron's Kapolei refinery, or any of the importers from the West Coast or Asia -- face any disruptions, consumers will see prices skyrocket, he said.

"I can't think of any positive way to spin a refinery closing to motorists, because there is none," he said.

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