A power outage at BP’s Whiting Refinery in northwest Indiana, the largest in the Midwest, has sharply reduced gasoline supplies to the Great Lakes region and driven up prices at Wisconsin pumps, analysts said.
The refinery, which processes about 440,000 barrels of crude per day and supplies much of southeast Wisconsin through Chicago-area terminals, went offline after a brief loss of electric power on the night of April 27. Flaring was reported as operators worked to safely shut down and restart units.
The disruption comes as the facility has operated under a labor lockout since mid-March. BP locked out approximately 800 United Steelworkers members after contract talks stalled, bringing in temporary workers to maintain operations. The refinery has faced repeated challenges this year, including an earlier labor uncertainty period.
AAA reports Wisconsin’s average price for regular unleaded gasoline stood at $4.16 per gallon Thursday, up nearly 50 cents from a week earlier. Southeast Wisconsin has been hit hardest because of its reliance on Whiting and other Chicago-region supplies.
Industry analyst Patrick De Haan of GasBuddy said the outage, combined with typical spring refinery maintenance across the region, has tightened inventories at a vulnerable time. Wholesale gasoline prices in the Midwest climbed in response, passing higher costs to retailers and consumers.
BP said it restored operations after the power interruption and was conducting safety checks. The duration of any reduced output will determine how long the price pressure lasts, analysts said.
Drivers in Milwaukee, Racine and other southeast counties have seen some of the steepest overnight jumps. Western Wisconsin markets, which draw from different pipelines, have experienced milder increases.
