April 25 (Bloomberg) -- The U.K.'s first refinery strike in 73 years is forcing BP Plc and other producers to prepare to idle about a third of oil and gas output from the U.K. North Sea and sparking concerns of a fuel shortage in Scotland.

Some 1,200 workers from the 200,000 barrel-a-day refinery owned by Ineos Group Holdings Plc at Grangemouth will be on strike for two days starting at 6 a.m. April 27, crippling the region's energy industry. The dispute threatens a BP pipeline that carries about 600,000 barrels of oil a day, more than a third of Britain's production, after the Unite union rejected a request to supply power to the link late today.

``There's going be a significant economic impact for the nation,'' said Malcolm Webb, Oil & Gas U.K.'s Chief Executive Officer today by phone. ``This is a completely disproportionate impact for what is a local labor dispute.''

Oil prices approached record highs in London futures markets and retail fuel prices in Scotland have increased at a rate double the U.K. average since April 20, according to the AA, Britain's Automobile Association.

The Grangemouth refinery supplies about 95 percent of the fuel used in Scotland's central belt, including the capital, Edinburgh, and Glasgow, its biggest city.

Truckers in Scotland are being rationed, according to the Scotland and Northern Ireland Road Haulage Association. ``Most of the hauliers have fuel cards and they can only have 70 liters of diesel'' each, Philip Flanders, regional director of the association said in a phone interview today. ``The situation is pretty bad for hauliers.''

Strike `Inevitable'

A labor stoppage is ``inevitable'' and tensions may escalate if Ineos fails to respond to Unite demands to keep the current pension scheme, Tony Woodley, the union's joint general secretary, told reporters outside the facility today.

``We have a dispute now that nobody wants,'' Woodley said. Unite is the U.K.'s largest manufacturing union. ``The company should look at this as an opportunity for a pause for peace.''

Petrol garages operated by Royal Dutch Shell Group Plc and the U.K. unit of Exxon Mobil Corp. in central Edinburgh have been roped off with ``No Fuel'' signs in the price display window. A half a kilometer line was reported at another Shell station in Edinburgh, signaling panic buying.

``We expect some petrol stations in Scotland to add two or three pence to the price of their fuel, which often happens when panic-buying threatens'' says Edmund King, AA's president in a written statement. ``Those fuel stations that add five to 10 pence to the cost of a liter are likely to anger local residents.''

Talks between company management and union leaders initially broke down April 23 over disagreements on an Ineos pension proposal that workers contribute to retirement for the first time.

Lost Output

The potential loss in production may be as high as 50 million pounds ($99.4 million) a day to the U.K. economy and will cost the Treasury 25 million pounds a day in lost tax revenue from North Sea production, Oil & Gas U.K. said.

It may take at least a week to resume production from the fields once the pipeline opens again, Webb said.

The government is asking motorists not to panic-buy fuel and U.K. Business Secretary John Hutton told Parliament yesterday that recent imports of fuel into Scotland meant that supplies would be ``sufficient'' during the closure.

Ineos will import fuel at its refinery jetty until the strike occurs in an effort to keep available supplies high, company spokesman Richard Longden said.

The current pension was inherited from BP Plc when Ineos bought Grangemouth and other parts of the oil company's chemical division in 2005.

Ineos offered this week to reduce the annual increase in employee pension contributions, raise the lump sum paid for redundancies by 20 percent and lower the age limit for workers to 50 that will see no change in retirement benefits.

To contact the reporter on this story: Bill Murray in London at wmurray1@bloomberg.net

Last Updated: April 25, 2008 13:59 EDT