Explosion Fuels Concern Over Price at the Pump

The BP plant in Texas City, Texas produces 3% of the U.S. gas supply.

Now both experts and local businesses are waiting to see what effect the fire will have on the future market.

"That refinery, it's about almost a 500,000 barrel a day refinery," says Bob Bartlett, President of the Petroleum Marketers Association of Wisconsin, "It's a good size refinery."

Based on incidents in the past, experts say the explosion could affect your price at the pump.

"The rumors are the futures trading has already increased because of this explosion," says Bartlett.

That increases the burden on many local businesses.

Jay Smith, Operations Manager for JOS Transportation, says, "We have to increase the price we charge to our customers per mile who in turn have to increase prices to their customers. That increases the prices we pay as consumers."

At his Madison-area trucking company, they're paying $25,000 more a week on diesel fuel than this time last year. They live by the philosophy, every penny counts.

"A penny doesn't sound like much until you add that up over the course of 150,000 to 200,000 miles per year times X number of units per year," says Smith, "So yes, even a penny makes a big, big difference to me."

Truckers aren't the only ones feeling the pinch.

"We try to build in enough of a cushion for unexpected issues like this and so far we're within that realm," says John McNamara of Union Cab.

But he's not discounting a price hike, as they go through nearly 250,000 gallons of gas each year.

"We don't want to act too prematurely with rates of anything if the prices drop quickly," says McNamara, "But all signs are looking like we're in for a long haul here."

A haul with no end in sight.

"Even though demand marches forward at at least 2% every year, we have not added the capacity we need to add to keep our economy rolling," says Bartlett.

Prior to Wednesday's refinery explosion, crude oil was trading at roughly $56 a barrel. That's an increase of more than $15 a barrel since December.

But crude futures jumped almost 1% about an hour after word of the massive explosion.

Experts say it's still too early to tell the short and long term effects the disaster will have on the rest of the country.

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