The Cost Of Valero Closing

  We are all aware of  the cost that the  Valero refinery in Delaware City closing will have on the state’s economy. We are also aware of the effect it will have on those directly effected by the loss of their jobs from that closing.

  There is also a ripple effect from this closing. How many small coffee and sandwich shops in the area will close now that all of those employees will no longer be coming through the area , or taking breaks and lunch.

  Think of all of the suppliers who will no longer be delivering to the refinery. There are probably hundreds of small businesses that will be affected by this closing that won’t receive any state or federal funding to support them through this loss.

  Also let me tell you as someone who works in the home heating industry that this closing will greatly affect your retailers  ability to get and deliver your home heating fuels, it will also affect the retail gasoline businesses in the area.

  I heard a state official saying on the radio (sorry I missed his name), that this closing would not have much impact on the availability of, or the price of home heating fuels.

  Let me tell you he is either lying or has no idea about how this industry works. He said that due to the mild weather we are experiencing and the reduction in international demand, that we should see very little effect in the availability or the price of fuels.

  Each retail supplier who has their own transport vehicle and who loads directly from a refinery, is allocated a set amount of fuel each month of the year. Once they have reach their ration for that month they must go to another refinery to receive more fuel for that month.

 So if Valero has closed then all of the retailers who receive fuel from Valero will have lost those allocated gallons for every month. The retailer cannot go to another refinery to make up those lost gallons , because they are already receiving a ration from those refineries. These gallons cannot be replaced locally.The refinerires are already at maximum output, this is why any little interuption creates a shortage. So retailers will be forced to travel further with their transports or receive shipments through railroad shipments.

 So due to the added expense of transporting further and the reduced availability prices will naturally increase. Also , as in past winters, if the mid-west experiences a colder than usual winter, it will make finding the fuel even harder.

 This closing will have far-reaching effects both on state and personal finances. And I find it hard to believe that Valero made this decision overnight. It would seem to me that they would have been in contact with the state trying to find a way to stay open. You would hope that the state would have done everything in its power to keep such an important industry open.

 But don’t worry folks the governor has a plan to replace all of these lost jobs with green industry jobs. I hope that is some comfort to you as you are paying higher heating cost this winter and higher gasoline cost next summer.

 

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