Oil Union Says Shell Talks to Resume in a Week Amid StrikeLynn Doan
United Steelworkers and Royal Dutch Shell Plc will resume labor negotiations in a week amid the largest U.S. refinery strike in more than three decades.
The USW said in a text message late Wednesday bargainers were ready to meet “but industry still unprepared” and that negotiations will resume in a week. Shell spokesman Ray Fisher said the company was gathering data requested by the union and he couldn’t give a precise date the information would be shared.
A recess in negotiations prolongs a strike at nine U.S. refineries accounting for about 13 percent of the country’s processing capacity. It’s the first national strike by U.S. oil workers since 1980, when a walkout lasted three months. One of the sites affected has halted production, and a full strike of USW members would threaten to disrupt 64 percent of U.S. fuel output.
Shell, representing companies including Chevron Corp. and Exxon Mobil Corp., indicated it won’t return to talks with the United Steelworkers until Feb. 18 as it gathers requested data, three people with knowledge of the discussions said Wednesday, asking not to be identified because the information isn’t public.
The USW has been asking for better health-care benefits and tougher measures to prevent fatigue and keep union workers rather than contract employees on the job. Union leaders on Tuesday offered a proposal that would limit the use of contractors at refineries and require that plants be “adequately” staffed, a statement posted on the USW’s website shows.
“We are opening our books to them with some sensitive data,” Fisher said. “We look forward to getting back to negotiations.”
The union began the strike at seven refineries after negotiations with Shell fell apart and workers’ contracts expired on Feb. 1. Affected were Tesoro Corp.’s plants in Martinez and Carson, California, and Anacortes, Washington, and Marathon Petroleum Corp.’s Catlettsburg complex in Kentucky. In Texas, Shell’s Deer Park complex, Marathon’s Galveston Bay plant and LyondellBasell Industries NV’s Houston facility were targeted.
USW members at BP Plc’s 405,000-barrel-a-day Whiting and 135,000-barrel-a-day Toledo refineries joined the strike over the weekend.
Tesoro’s Golden Eagle refinery near San Francisco had halted all fuel production by Feb. 6. The plant already had about half of its output offline for maintenance before the strike and shut completely after the walkout began.
West Texas Intermediate oil for March delivery added 90 cents to $49.74 a barrel in electronic trading on the New York Mercantile Exchange at 2:35 p.m. Singapore time.
Shell’s Deer Park refinery had a breakdown at a fluid catalytic cracker on Feb. 8, Fisher said by e-mail on Wednesday. The unit, which upgrades gasoil into fuels including gasoline and diesel, was taken out of service and may restart on Thursday, according to the Sugar Land, Texas-based data provider IIR Energy.
United Steelworkers members operate refinery units, perform maintenance and work in labs at the plants.
The USW and Shell began negotiations on Jan. 21 amid the biggest collapse in oil since 2008, driven largely by surging output from U.S. shale formations that cut prices by 49 percent in the second half of 2014.
Refiners in the Standard & Poor’s 500 have more than doubled since the beginning of 2012, when the steelworkers last negotiated an agreement. Marathon and Tesoro went on that year to take their place among the 10 best performers in the S&P 500 Index.
The national agreement, which addresses wages, benefits and health and safety, serves as the pattern that companies use to negotiate local contracts. Individual USW units may still decide to strike if the terms they’re offered locally don’t mirror those in the national agreement.