GASOLINE FUTURES PRICES CLIMB ON REFINERY FIRE

GASOLINE FUTURES PRICES CLIMB ON REFINERY FIRE

The Shell Oil Co. refinery fire in Norco, La., sent gasoline futures prices climbing Thursday and Friday, but Shell officials say they have enough product in storage to keep their customers supplied for as much as two weeks.

At least three Shell employees died and 42 other people were injured by an explosion that ripped apart the plant's catalytic cracker Thursday morning.The cause of the blast has not been determined, and Shell has not estimated how long the refinery will be out of operation.

The accident has cut Shell's gasoline refining capacity by 130,000 barrels a day, said a Shell spokesman in New York. Shell's total capacity in 1987 averaged 523,000 b/d.

Oil traders in New York responded immediately to the news of the explosion, pushing the June futures price for unleaded gasoline up 0.89 cents a gallon to 50.61 cents at Thursday's close. On Friday, the price rose another 0.8 cents a gallon before falling back slightly in the afternoon.

Despite the belief that the Norco explosion will tighten gasoline supplies, a Shell executive overseeing its gasoline production said the company expects to meet its obligations from storage and by increasing capacity at other refineries.

We probably have enough in storage to last 10 days to two weeks, said Robert Sherwood, Shell's business manager, gasoline, for the Eastern part of the United States. He said this lead time will allow Shell to increase capacity at other refineries, or make other arrangements to keep its retail and wholesale customers supplied.

Shell operates 4,200 company-owned stations and serves 5,700 independent stations that use the Shell brand, said the company's New York spokesman.

A Shell service station manager in New Orleans said the company had told him all demand would be met by stockpiles of gasoline for the foreseeable future.

When I called for my order, it was business as usual, he said. They said there wouldn't be any problems, but we'll see. This has never happened before, so I really don't know what to expect.

The catalytic cracker was part of a complex of oil and petrochemical refining facilities at Norco, all of which have been shut down by the explosion.

Shell has six other gasoline production facilities, and Norco was one of the three largest.