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Latest News - February 2015

February 22, 2015
Strike at U.S. Refineries Widens

Union workers walked out of three more U.S. refineries this weekend, including the nation’s largest fuel-making facility, expanding a nearly month long strike.

After the latest negotiations ended late Friday, workers at the Motiva Port Arthur Refinery in Texas, the nation’s largest, walked off the job just after midnight. They were followed a day later by workers at the Motiva Convent, Motiva Norco, and Shell Chemicals Norco plants. Motiva Enterprises LLC is co-owned by Shell and a subsidiary of Saudi Aramco.

More than 6,500 United Steelworkers members are now on strike at 15 petrochemical facilities, the union confirmed Sunday, including 12 refineries that account for 19% of U.S. refining capacity.

The main sticking point is the Steelworkers’ demand that refinery owners replace contract maintenance workers with union members, according to Royal Dutch Shell , which is leading bargaining for the energy industry.

The union believes its members “are more qualified and better trained to perform the duties that need to be done to keep our equipment running safely,” said Hoot Landry, a union representative.

So far the strike has had little effect on gasoline production or prices. The plants have largely continued operating, though one California refinery—already partially shut for maintenance when the strike started—remains closed.

But oil prices might weaken if another major refinery is shuttered because of the strike, said Tom Kloza, global head of energy analysis at the Oil Price Information Service.

The loss of demand from refineries could mean “more trouble for the crude oil market,” he said. The benchmark price for U.S. crude has fallen by about 50% since June, to under $51 a barrel, largely because of soaring American oil production.

The union and Shell have been trying to hammer out a new three-year contract that will set the pattern on wages, benefits, and safety issues for individual refineries. The union has so far rejected seven offers from Shell.

Some workers have returned to their posts at Tesoro Corp. plants, the company said Sunday, though it would not provide details. Workers are striking at three of the company’s refineries.

And about a dozen union workers out of 450 crossed picket lines at LyondellBasell Houston refinery, according to a person familiar with the matter.




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