Philadelphia Energy Solutions (PES) announced the closing of their doors a couple of weeks ago, but there was, and still is, a lot of uncertainty for what that means for the future of the union workers and the physical plant itself. PES recently announced its commitment to extend pay for union workers through August 25th, according to StateImpact Pennsylvania. U.S. Senator Bob Casey and PES representatives have confirmed that PES will pay its workers through the expiration of their collective-bargaining agreement. While the unions are holding on to hope that parts of the refinery will remain open or sell to a new operator quickly, it seems increasingly unlikely that will happen.
Analysts are getting increasingly worried that the refining industry will not be prepared in time to meet the lower sulfur regulation under the new International Maritime Organization (IMO) set to begin January 1, 2020 and will subsequently increase diesel prices in relation to crude oil.
Across North America, temperature fluctuations, refinery turnarounds, and pipeline disruptions have created supply challenges getting petroleum to market. When refineries shut down for maintenance there is always a potential for a supply shortage in the effected markets, couple that with increased demand due to weather and all of a sudden a long (plenty of product) market becomes a short (scant amounts of product) market.