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Business

Refinery Workers Strike: Shell Oil, Marathon, And LyondellBasell

The strike is still limited to a handful of facilities around Houston and in three other states. But if it widens or drags on, it could affect gas prices.

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It’s been 35 years since the last major strike at this country’s oil refineries and chemical plants, but that streak is over. Nearly 4,000 union workers are off the job at a handful of facilities that process 10 percent of the country’s gasoline, diesel, heating oil, and jet fuel.

More than 100 workers, members of the United Steelworkers union, gathered Tuesday just outside a skyscraper in downtown Houston. The strikers met at the LyondellBassell Tower, operational headquarters for the Dutch refining company. The union members were going to begin a demonstration just as the company’s top executives were going to hold their quarterly conference call with stock analysts. But then the group decided to start its march early.

“Well, first and foremost, the industry walked away from the table,” says Lee Medley, a pipefitter at the Shell Deer Park Refinery east of Houston and president of United Steelworkers Local 13-1. “That led to the strike quicker than anything. It’s hard for us to vote on something when they walk away from the table.”

Negotiations broke down between the union and Shell Oil over the weekend. In the Houston area alone, steelworkers have walked off the job at two Shell plants, two Marathon facilities, and the LyondellBassell refinery.

The union is pushing for higher wages. But Medley says a bigger concern is workplace safety. The union says the companies are requiring excessive overtime, which can reduce workers’ sleep time, and contracting out skilled jobs to unskilled workers less familiar with safety rules.

“I was born in Texas City,” Medley says. “I’ve been in this area working in the refineries for 35 years now. My kids were raised here. So it’s us in the community. We live here. So if they’re hurting safety, they are putting my family and my friends at risk.”

What it’s likely to mean for consumers? Kenneth Medlock, senior director for the Center for Energy Studies at Rice University, says the impact is minimal for now. “Inventories for crude and products are just sky high right now,” Medlock says. “You know, there’s actually plenty of cushion for the market to be able to absorb any sort of short-term shut down in production.”

But if the two sides can’t reach an agreement, the strike could spread to other union sites. The United Steelworkers represents 30,000 workers, responsible for about two-thirds of the country’s refining capacity.

If the strike lasts as long as eight to ten weeks, inventories would start to run down. The last industrywide strike, in 1980, lasted for three months. Another concern, refineries need to start retooling in March, to shift production of gasoline to summer blends.

But the companies may be in a better position to withstand a prolonged strike than the workers. Kevin Troutman, an attorney with the Houston office of Fisher & Phillips, represents employers in labor law disputes.

“Things are more automated throughout the industry now than they were 30 years ago,” Troutman says. “They can bring in either management employees or experienced workers from elsewhere. You don’t need as many workers to continue to operate as you would have 30 years ago because of technology.”

Neither Shell, Marathon, nor LyondellBassell would agree to comment for this story, other than to say that negotiations were still ongoing. No end to the strike appears in sight. 

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Andrew Schneider

Andrew Schneider

Politics and Government Reporter

Andrew Schneider is the senior reporter for politics and government at Houston Public Media, NPR's affiliate station in Houston, Texas. In this capacity, he heads the station's coverage of national, state, and local elections. He also reports on major policy issues before the Texas Legislature and county and city governments...

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