Diesel prices to rocket if Coryton refinery closes permanently

Posted on 25 Jan 2012

The knock-on effect of the halt of fuel sales from Petroplus’ refinery in Coryton could be devastating, potentially leading to prices increasing to £7 a gallon and the loss of 1,000 jobs.

Administrators PwC were last night still struggling to find a buyer for the plant, warning that there was a severely limited amount of time left to save the 1,000 jobs at risk.

The refinery Coryton supplies 20% of petrol stations in the South East and London, and some ssources said that it was only a matter of time before petrol stations would run out of fuel for motorists.

Energy Minister Charles Hendry said: “We will engage fully with the administrators. We are keen to secure a sustainable future for the refinery operations.”

Hendry reassured motorists that the supply of petrol would be sustained by petrol companies. He said: “There is the capacity in some of the other refineries in the UK. Companies like BP and Shell, who are the main buyers of the output from Coryton, have already made short-term arrangements to make sure that they get the fuel from other sources. We have spare import capacity so we can bring extra fuel in as necessary.”

Richard Howitt, an MEP for the East of England, said he feared petrol supplies would be affected.
“I don’t want to be alarmist, but I don’t want to be dishonest either,” he said. “Supplies across London and the South East could be affected and I have been told this could impact the Olympics.”

The firm has been in trouble since just after Christmas, when a £1m credit line was withdrawn by the bank. Petroplus has gradually scaled down its operations across Europe because it hasn’t been able to buy crude in the absence of credit.