Oil Firms Set to Bounce Back Quickly After Hurricane Sandy

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Although nearly 70 percent of the East Coast refinery production was shut down due to Hurricane Sandy, BP’s Chief Executive Bob Dudley said that oil firms are set to bounce back quickly.

“I think it will bounce back very fast, the distribution system there is very efficient,” Dudley told CNBC News. “I think we, and other companies, will get product in there.”

As of Wednesday morning, the Philadelphia Energy Solutions plant, which processes a third of the region's oil and is considered the Northeast's largest refinery, said it was "without issues." That lessens the risk of a gasoline shortage that would drive up prices. Philadelphia Energy produces 330,000 barrels per day (BPD).

Phillips 66 said there was "some flooding in low-lying areas" of its 238,000 BPD Bayway, N. J., plant, which was shut on Monday as a precaution. The plant remains closed, the company said, and utility PSE&G said power was likely to be restored no sooner than in 24 to 48 hours.

Hess Corp's 70,000 BPD Port Reading, N.J., refinery, which had also closed ahead of Sandy, has yet to issue a time frame for restarting.

Although the Energy Department postponed release of its inventory report from today, gasoline and diesel prices continue to drop in the storm’s aftermath, according to AAA. The average price for a gallon of regular gasoline stands at $3.52, down a penny from yesterday and down 10 cents from a week ago. Diesel prices stood at $4.05, down a nickel from a week earlier.

Photo Credit: samc/bigstock.com

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