Northeastern states are slated to lose half of their regional capacity for fuel production by midyear as financial woes push refineries there to idle, a trend likely to increase the region's dependency on Gulf Coast supply.A Houston-to-New York pipeline is making major expansions to accommodate growing demand to transport gasoline and other fuels up north from the Gulf Coast to fill the potential supply void.The Gulf already supplies about half of the Northeast's demand for petroleum products, said Mindi Farber-Deanda, head of the liquid fuels market team for the U.S. Energy Information Administration.But the shutdown of production at two major Pennsylvania refineries last year and potential closure of a third could put the region in a precarious position and stress supplies of gasoline, jet fuel and heating oil, the agency concluded in a new report."It's marginal, but it matters," Farber-Deanda said of the drop in the Northeast's local fuel production. "Before, you could get a certain percentage of supply from local refineries. Now you get it from Europe and the Gulf."The report noted that Northeastern states could experience "spot shortages with price hikes" for gasoline and other fuels as refineries discontinue operations.Sunoco announced last month that it will idle operation of its 335,000 barrel-per-day refinery in Marcus Hook, Pa., part of the company's plan to pull out of the refining business altogether. If Sunoco doesn't find a buyer for its 178,000-barrel-per-day Philadelphia refinery by July, it will go off line, too, the company has said.
ConocoPhillips announced a similar move in September, taking its 185,000-barrel-per-day Trainer, Pa., refinery off line to prepare it for sale.
Gulf Coast working to fill a fuel void in Northeast - Houston Chronicle