Oil Rises as Workers Strike at Nine Refineries
Oil climbed to over $50 a barrel Monday as workers at some of the nation’s refineries began strike action.
Crude futures rose to as high as $50.56 in early New York Mercantile Exchange trading, after gaining almost $4 on Jan. 30. Oil closed below $45 for two days last week, its lowest level since March 2009.
The United Steelworkers union, which represents employees at more than 200 U.S. refineries, terminals, pipelines and chemical plants, halted work Sunday at nine refineries after failing to agree on a labor contract.
The union said in a statement that it “had no choice,” and rejected five contract offers made by Royal Dutch Shell on behalf of oil companies including Exxon Mobil Corp. and Chevron Corp. since labor talks began on Jan. 21.
The union hasn’t called a national stoppage since 1980, when a strike lasted three months. The refineries on strike can produce 1.82 million barrels a day of fuel, about 10% of total U.S. capacity, according to Bloomberg data.
U.S. drillers idled 94 oil rigs last week, the most since Baker Hughes Inc. began collecting data in 1987. The number of active machines shrank to a three-year low, the Houston-based oilfield services company said.
