RICHMOND -- California could suffer a spike in gasoline prices in the coming days and weeks due to the fire at Chevron's refinery in Richmond, coupled with the state's tight fuel supplies, analysts said Monday night.
"If the refinery is disrupted for an extended period of time, there would be an effect on gasoline prices on the West Coast," said Pavel Molchanov, an analyst with investment firm Raymond James. "The effect on California fuel prices is likely to be meaningful."
The key is the nature of the damage and whether the fire hobbles operations at the vast Richmond refinery.
The Chevron plant can process 240,000 barrels of crude oil a day and is the Bay Area's largest refinery.
"There are not that many refineries in the state, so California is very reliant on the Richmond refinery," said Christopher Thornberg, principal economist and founding partner with Beacon Economics. "So you could definitely see an effect on gasoline prices."
California's strict environmental and air quality rules also mean that California vehicles can burn only a specialized cocktail of fuels.
"The specialized fuel creates tight gasoline supplies in California," Thornberg said. "There is less supply so that tends to drive up prices in California anyway."
Gasoline prices can be affected even when refineries have unscheduled maintenance hiccups or come back on line sooner than anticipated.
Still, refinery fires come with the territory.
"Fires at refineries are quite common," Molchanov said. "Refinery fires are certainly not unheard of, considering the sheer amount of high-temperature processes that go on there."
Contact George Avalos at 925-977-8477. Follow him at twitter.com/george_avalos.