Wholesale gasoline prices surge after power outage shuts down Torrance refinery
Wholesale gasoline prices jumped Tuesday and consumers could see higher prices at the pump after a South Bay power outage forced a Torrance fuel refinery to shut down.
Southern California Edison reported a power outage that left more than 100,000 South Bay residents without electricity Tuesday morning. The former Exxon Mobil refinery also lost power, the second such shutdown in as many months. Nearby residents were told to temporarily shelter in place as smoke and flames rose from the facility’s stacks.
Spot market gasoline prices rose as much as 14 cents a gallon Tuesday, but it remains unclear whether motorists will see those increases at retailers. The average price for regular unleaded gas in Los Angeles on Tuesday was $2.84 a gallon, down nearly a penny from the day before.
“We haven’t seen anything move on the retail end,” said Jeffrey Spring, a spokesman for the Automobile Club of Southern California. “At this point we need to take more of a wait-and-see attitude. Hang on to your chair.”
Jeffrey Dill, western region president of PBF Energy, which recently bought the Torrance plant, said it will take days to return the refinery to full operations. But he added that the company has sufficient inventories to meet its commitments.
“The refinery does have some of its own electrical generating ability,” Dill said. “But if we lose power from the grid, it’s going to trip the refinery off.
“This time we lost power for over 20 minutes,” he said. “It was literally a complete power failure.”
A power outage Sept. 18 also caused the refinery to shut down, triggering a price rise in the spot market. But retail prices largely remained steady. That’s because gasoline prices overall were dropping due to a switch from the state-required summer blend to the winter blend, which is less costly. The summer blend helps guard against excessive emissions when the weather is hot.
Tuesday’s outage could prompt gas prices to rise, but that would be short-lived if the plant had no damage from the power outage, Spring said.
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