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Refinery Fire Expected to Spike Gas Prices; Shakeup at Komen; Hottest in History; West Coast Bracing for Gas Price Spike; China's

Fri, 08/10/2012 - 3:21pm
The Associated Press

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POPPY HARLOW, CNN ANCHOR: Price spike at the pumps. A fire at a major refinery expected to burn gas customer across the country.

ZORAIDA SAMBOLIN, CNN ANCHOR: A developing story. A shake-up at the top two executive at the nation's largest breast cancer foundation out.

HARLOW: And hottest in history, you felt it, folks. Now scientists are saying it. July was one for the record books.

Good morning and welcome to EARLY START. I'm Poppy Harlow, in for John Berman.

SAMBOLIN: And I'm Zoraida Sambolin. Glad to have you with us. It is 5:00 a.m. in the East.

So, let's get started here.

Up first, the California fire that's about to burn a hole in millions of wallets. This was the scene Monday at Chevron's Richmond, California oil refinery. A huge toxic blaze partially shutting down production at one of the region's biggest gas suppliers. Not a good time for that to happen because it's expected to send pump prices skyrocketing on the West Coast and beyond.

Ed Lavandera is live in Dallas, Texas, this morning.

It's not just about gas prices. It's about people and health concerns in that area, as well, right?

ED LAVANDERA, CNN CORRESPONDENT: Oh, there's no question. I think of the people there who have been up close with the refinery fire that started on Monday, and is still not quite back up to full production, have been dealing with the effects of that.

But if you're like me, you've noticed over the last few weeks already, as you pull into the gas station, hey, something is not quite right. But that's because the national average of gasoline prices has risen to $3.63 a gallon. That's up almost 30 cents in the last five weeks. So quite a jump here that we've seen and several analysts that we've been talking to say they expect that to continue to climb. So the question is, at what point will it stop? And what's causing all of this. Of course that's a very complicated matter when it comes to issues of gas prices. A lot of factors in this. What we've seen over the last few weeks is a series of disruptions at refineries, not only in California, but across the country, from the Midwest to Oklahoma.

But obviously most significantly this week is the massive fire in Richmond, California there in the San Francisco Bay Area, which is some analysts suggesting that could bring gas prices there into California and West Coast area, up to $4 a gallon. And that's obviously a big mark.

But in the short-term, the residents near the refinery have been telling us, talking about how miserable the whole experience has been.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: You're putting this poison out here, killing us.

UNIDENTIFIED FEMALE: Do I have to look forward to having cancer? Does my grandchild have to look forward to having cancer?

UNIDENTIFIED MALE: My people ain't for sale. These nickels and dimes that you pass us around here are no good for none of them.

(END VIDEO CLIP)

LAVANDERA: Zoraida, of course, the question is at what point will these gas prices start kind of leveling off and perhaps going back down. Some analysts suggest as we head into the fall, that we should start seeing the gas prices kind of leveling off or dropping back down.

But in the short term, they expect a little bit more of the same as the gas prices continue to tick higher and higher -- Zoraida.

SAMBOLIN: All right. Ed Lavandera, live for us -- thank you very much.

HARLOW: Well, a major shake-up at the nation's largest breast cancer foundation this morning, Susan G. Komen for the Cure. The president Liz Thompson and founder, Nancy Brinker, stepping down from their post. Thompson will leave the organization next month and Brinker will surrender her CEO title and focus on fundraising and planning.

It's being seen by many as just more fallout from Komen's decision earlier this year to briefly suspend funding for Planned Parenthood.

In and the next hour of EARLY START, we'll talk about the politics behind the Komen shake-up with Laura Bassett. She's a political reporter from "Huffington Post," who first broke that story.

SAMBOLIN: And we could soon find out the mindset of the man police say was behind the Aurora, Colorado, theater killings. James Holmes is expected back in court this afternoon. Public defense lawyers want investigators to hand over the documents and that package that Holmes sent to his psychiatrist at the University of Colorado. That package was seized by authorities under a search warrant last week. The defense says it's privileged doctor/patient communication.

Holmes is charged with killing 12 people and injuring 58 others at a midnight screening of "The Dark Knight Rises."

HARLOW: You hear screaming "Allahu Akbar" as military fighter jets, choppers and tanks unleashed on a virtually devastated parts of Aleppo, that was once Syria's most populated city. The Syrian government and the opposition offering different accounts of who controls a key neighborhood.

A Syrian opposition network says at least 167 people were killed across the country yesterday alone.

SAMBOLIN: The first day in the murder trial for China's so-called Jackie Kennedy has adjourned just a few hours ago. Gu Kailai, the wife of ousted communist official Bo Xilai is accused of poisoning a British businessman, in an attempt to save her son, who prosecutors say was caught up in a money dispute.

Experts say the case's outcome could have major political significance.

HARLOW: Well, the heat is definitely on this summer, we certainly felt it, that's for sure. I'm not forward to my air conditioning bill. This July, folks, hottest on record.

Meteorologist Alexandra Steele is in Atlanta where I was down there, by the way, in July, it was 106 degrees.

And I walked out at, you know, 5:00, 6:00 a.m. to go to work, and I think it was already 100 degrees. So, we've all felt it, right? These are historic highs.

ALEXANDRA STEELE, AMS METEOROLOGIST: Absolutely. And now, just coming down off the presses last night, officially, guys, July -- hottest month for the entire U.S. since 1895, even surpassing the July of those famous dust bowl years of 1936. So, it certainly felt hot with the temperatures in the 100s, now for the record books, it surely has been.

Top 10 warmest Julys, we had it in 32 states. And also, the last 12 months have been the hottest on record. So, as an aggregate as the country, individual states have had the warmest and the last 12 months have been the warmest.

So what's the outlook, right? Is the heat continuing? You've got it.

Here's the forecast. The computer model projection through October, temperatures remain above average. And, of course, part and parcel to the heat, and the drought, and dry conditions, you can see for portion of the country as well. Yesterday at this time, we were talking about Ernesto making landfall as a hurricane. You can see where it is now. Tropical storm once again, winds back up to 70 miles per hour. Expected to make its second landfall, potentially as a hurricane, but there's just not a lot of time, limited time over the water, for really any more intensification.

But our attention turns from Ernesto to potentially Gordon, tropical outlook here in the Atlantic. There's a potential 70 percent chance for this to become our next tropical cyclone. If so, it will be Gordon and all our eyes and attention will focus to Gordon.

But that being said, we'll have to watch it and see what happens today.

HARLOW: Absolutely. Thanks so much.

STEELE: You're welcome.

SAMBOLIN: The Martian crater where NASA's Curiosity rover landed looks a lot like earth. Actually, a California scientist compares some early pictures of that crater to the Mojave Desert. Both are said to have looming mountains and a lingering haze.

The Curiosity successfully and very memorably touched down on Mars Sunday night.

HARLOW: That's my favorite video of the week. It's adorable. They're so thrilled. A perfect execution there.

Well, it's end of an Olympic era -- a dynamic duo cap off their career and put Team USA on the top. We're going to bring you live to London, next.

(COMMERCIAL BREAK)

HARLOW: Welcome back to EARLY START. It is 11 minutes past the hour. I'm Poppy Harlow.

SAMBOLIN: And I'm Zoraida Sambolin. Thanks for being with us thing morning.

So, it's just another historic day at the beach, did you watch? The U.S. now on top in total medals at the Olympics, thanks in part to that history-making beach volleyball team. Three-time champs, Misty Mae-Treanor and Kerri Walsh-Jennings.

Amanda Davies is following all the actions. She is live in London.

And it wasn't just an all-USA volleyball final. It was a final match for these two gals as a team as well. I actually watched this one because I wanted to watch history in the making. I think everybody expected them to win.

AMANDA DAVIES, CNN CORRESPONDENT: Yes, it was great occasion, wasn't it? And Misty Mae-Treanor signed off saying it's now time for her to be a wife and mom after that third Olympic gold medal with Kerri Walsh as you said, people here talking about a three-peat on horse guard's parade, definitely one of the most stunning venues and Prince Harry was there watching and David Beckham was there watching.

But now, it's very much a case of handing over the baton, isn't it, to another American pair, Jennifer Kessy and April Ross, the world champions from 2009. So the end of an era, but possibly the start of another one for USA beach volleyball.

SAMBOLIN: Wouldn't that be wonderful, Amanda, we would love for that to happen.

So, it was also golden in track and field, tell us about that?

DAVIES: Oh, an incredible three gold medals in the 30 minutes, not exactly bad going. Allyson Felix kicked it all off in the women's 200 meters, she held off a really strong field and of course she got two silver medals in this event in the last two Olympics. But then went on to claim gold and her smile, mega, megawatt smile lit up the Olympic stadium. Carmelita Jeter took bronze in that one.

And then Aries Merritt decided to get in on the act in the 110 meter hurdles. He'd been saying he was treating the final as if it was a practice run. He did pretty well. He went on to take gold. And in a personal best time as well.

And then Brittney Reese stepped up for the long jump. She only recorded two jumps, enough to give her the gold medal as well.

So, we haven't had any of those medal ceremonies yet. But it's going to be the "Star-Spangled Banner" all the way later on behind me in the Olympic Stadium, when those get handed out.

SAMBOLIN: Go Team USA.

All right. And coming up today, the potential for drama is very high as the U.S. women's soccer team takes on Japan.

DAVIES: Yes. This one is massively anticipated, isn't it? It's expected to be the biggest crowd ever for a women's Olympic football match at Wembley Stadium. It's USA against Japan. A repeat of the World Cup final from last year, that Japan won in Frankfurt on penalties.

Very interesting, the media call yesterday, the players lined up, one from the USA, one from Japan, all arm in arm, all looked incredibly happy and friendly. And then Abby Wambach stood up and said, uh-uh, that's not how it is going to be tomorrow. It's all about revenge for last year.

And, of course, USA looking for their third gold medal in four Olympic Games.

SAMBOLIN: All right. Love all the action. Thank you so much for bringing it to us, Amanda Davies, live in London. HARLOW: Well, in addition to the women's soccer final between the U.S. and Japan, the men's 200 meter final is on tap today, also, women's platform diving. I love diving and also men's beach volleyball, that final is ahead.

SAMBOLIN: Fifteen minutes past the hour. Let's get you up-to-date on the morning's top story.

Gas prices may soon surge above $4 a gallon on the West Coast as well as rise across the nation because of a fire at Chevron's Richmond, California refinery. That was earlier this week. Those are the pictures. The plant is partially shut down and it's one of the region's biggest suppliers. We're going to have a live report for you.

HARLOW: And we now know the final shot fired by the Sikh temple gunman, Wade Page, was into his own head. The FBI saying surveillance video confirms that Page committed suicide after being wounded in the stomach by a hero police officer on Sunday.

SAMBOLIN: Listen to this, a Delaware pediatrician and his wife arrested for allegedly waterboarding their 11-year-old daughter. Dr. Melvin Morse, a noted researcher in near-death experiences and his wife, Pauline, face reckless endangerment charges.

The couple's daughter telling police her father held her face under a faucet at least four times in the last two years to punish her while her mother stood by and watched.

HARLOW: That's unbelievable.

And so is this story, country singer Randy Travis out on bail after troopers in northern Texas allegedly found him lying naked on a remote road, apparently smelling of alcohol following his car careening off a highway and hitting several barricade. He was charged with DUI and felony retaliation, for -- get this -- allegedly threatening to, quote, "shot and kill the troopers working the case". Back in February, he pleaded no contest following public intoxication following the Super Bowl.

SAMBOLIN: Look at that mug shot. He sustained some injuries there as well.

So sick American being evacuated from Antarctica right now. An Australian medical team has picked up the patient and is now on its way to New Zealand. The team landed on an icy runway during a narrow window of twilight in Antarctica's dark winter.

The patient was picked up from McMurdo research station, temperature 13 degrees below zero Fahrenheit. The person is said to be in stable condition.

HARLOW: It is 17 minutes past 5:00 in the morning. We're on the East Coast. We're getting an early read on local news making headlines.

It is enough to shock Sin City. Vegas police have been flooded with calls about people very disturbed by that image. So here's what you're seeing. This comes out of the "Las Vegas Review Journal". That's a billboard, and that is mannequin hanging from the billboard.

But drivers on the road thought those were real people.

SAMBOLIN: I would, too.

HARLOW: Three different billboards. I would, too. I would probably crash and then call 911.

I want to tell you one of the billboards said, "Dying for work". Another said, "Hope you're happy, Wall Street."

Police obviously saying this is vandalism, not ads. Police are investigating it. It's interesting, in this article, Zoraida, they talked to a representative from Occupy Las Vegas, Occupy said they're in no way responsible for this. But they support it, saying it's not surprising that radical consciousness will find its expression through various forms of art.

Whoever did it is taking it way too far.

SAMBOLIN: Yes, it's dangerous and in poor taste.

Eighteen minutes past the hour.

A Michigan judge who was thrown out of office after being found guilty of misconduct, may wind up back on the bench. I do not get this story.

This is from the "Detroit Free Press." So ousted district court judge, Sylvia James, won the most votes in a primary election. She'll now be allowed to run for the seat she was thrown out of in the general election in Inkster, a town in Michigan, 30 minutes outside of Detroit.

So James joined the court in 1988. She was removed after being found guilty of misconduct. She was the top vote-getter in the Tuesday primary. She will run in the November general election.

This, you know, just a head-scratcher. They found out that she misused court funds intended for crime victims and she used the money to pay court employees instead. She's also accused of nepotism. She lied during the investigation and hearing, and yet she's running again and she could potentially win.

HARLOW: She has her supporters.

SAMBOLIN: Yes, she's got a lot of supporters. So that's who voted for her. Kind of crazy.

HARLOW: Yes, we'll see what happens in the general election.

Well, for an expanded look at all of our top stories today, head to our blog, CNN.com/EarlyStart.

SAMBOLIN: Pay for your coffee without ever taking your hands out of your pocket.

HARLOW: Really?

SAMBOLIN: More on the new innovation at Starbucks.

(COMMERCIAL BREAK)

SAMBOLIN: We are minding your business this morning. Let's check in on the markets.

U.S. stock futures trading higher this morning. European and Asian markets up, too, on hopes of more stimulus for the world's largest economies.

And Poppy has the rest of the business headlines this morning. We've got you working triple duty these days.

HARLOW: Triple duty, that's what you pay me for.

Well, let's start off with food prices, the drought across the U.S. is already pushing food prices higher. Corn prices jumping 23 percent in July worldwide. That's according to new data just out from the U.N. this morning. The U.N. also warns that prices could increase further this year -- certainly if the drought doesn't ease up.

Talking about mobile phones, Google's Android taking a big bite out of Apple's market share. Android phones accounted for 68 percent of the global smartphone market last quarter. That's four times more than the market share held by Apple's iPhone. This according to research firm IDC.

But keep this in mind. A lot of folks are holding out, waiting for the iPhone 5 that may come out in September. It could be part of what we're seeing play out.

Also, the Blackberry, do you have one of those?

SAMBOLIN: Yes.

HARLOW: Shipments sharply down in the quarter only about 5 percent of the market share is BlackBerry now. They're easier to text on. We'll talk about that later.

SAMBOLIN: Yes, we will.

HARLOW: Also, Starbucks teaming up with a mobile payment company called Square. This company created by the co-founder of Twitter, Jack Dorsey. Square will begin processing all of Starbucks credit card payments.

And eventually, here's the goal of the partnership, folks. When you walk into a Starbucks store, your photo and your name will pop up on the screen at the register. They'll read the data from your phone.

And then when you're ready to pay, you give them your name, they'll match your face to the photo on the register. That's all. You won't need to take out your phone or your credit card or anything to pay. They're developing that technology now. So if it works, you'll see it in stores. No date yet on when it will happen.

Interesting, too, Zoraida, Starbucks invested $25 million in this company so they're getting the tech space, too.

SAMBOLIN: The little square device, do you have to have it on your phone in order for it to work?

HARLOW: They have it, they're installing it.

SAMBOLIN: Very cool.

HARLOW: Yes.

People in Detroit office building never knew it, but they had been working right next to a bomb in the office for weeks. Wait until you hear how it got there, that is coming up.

And if you're leaving the house right now, you can watch us any time on your desktop, on your mobile phone, just go to CNN.com/TV.

(COMMERCIAL BREAK)

SAMBOLIN: Sky-high flames earlier this week at a California refinery. Take a look at those pictures. Now sky-high gas prices 'cross the country are expected as a result of that.

HARLOW: Well, we weren't expecting you, authorities, to find out how a plane ended up landing on the wrong runway at the wrong airport.

SAMBOLIN: All seeing. New York City's new futuristic digital eye to track crimes. Critics asking if there's any privacy left. But it's very cool technology.

HARLOW: It is.

SAMBOLIN: We're going to be talking about it.

Welcome back to EARLY START. I'm Zoraida Sambolin.

HARLOW: I'm Poppy Harlow. It is 30 minutes past the hour.

From the state of Washington, to the state of California, gas prices could go way up, and the rest of us may be seeing pain at the pump pretty soon as well. Here's the culprit: Chevron's Richmond, California oil refinery. A huge fire breaking out there on Monday, partially shutting down production at one of the nation's biggest gas suppliers.

Ed Lavandera joining us live from Dallas, Texas this morning. Ed, appreciate it.

You know, there's two concerns here. First of all, health concerns, people were irate at a town hall meeting about this and then, also, gas prices, one of the big drivers is the fact that you've got limited refineries on the West Coast, pretty separated from what you've got in the gulf, closer to where you are.

ED LAVANDERA, CNN CORRESPONDENT: It's an issue that you're not only seeing on the West Coast, but it's a problem that has plagued refineries over the last couple of weeks. And that's why we've seen, one of the reasons we've seen the jump in gas prices, almost if you blinked, you've kind of missed it. It's just kind of crept up on everybody.

Over the course of the last month, gas prices, the national average have shot up about 30 cents and this morning, the national average for a gallon of gasoline is $3.66. There's a great deal of many factors that go into this, worldwide issues and issues of demand. But what we've seen here in the last few months is also a question of disruptions, problems not only at the refinery in Richmond, California, in the San Francisco Bay Area, but also refineries from the Midwest down to Oklahoma, disruptions, pipeline ruptures, those types of things that have really slowed down the production and the flow of oil into gas stations and that's why we've seen these jumps.

But many of the people who live near the fire in Richmond, California, very angered by what they're dealing with and also very frightened.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: You're putting this poison out here, killing us.

UNIDENTIFIED FEMALE: Do I have to look forward to having cancer? Does my grandchild have to look forward to having cancer?

UNIDENTIFIED MALE: My people ain't for sale. These nickels and dimes that you pass us around here are no good for none of them.

(END VIDEO CLIP)

LAVANDERA: Poppy, the question now is at what point will we see gas prices start to level off? You know, many opinions floating around about that. But in California on the West Coast, they're talking about gas prices perhaps reaching $4 a gallon in many places, or going over that mark. And they expect to se gas prices continue to tick up here over the next several days and weeks.

Some analysts also suggest that as we head into the fall, demand will start to curtail a little bit and perhaps we'll start seeing it then. But at least here in the short-term, that dreaded phrase -- pain at the pump, is a very real reality -- Poppy.

HARLOW: I think you're right, that only relief is heading into the fall. If we do see the demand taper off a little bit.

But, you know, Ed, I was looking at the numbers, we're only 11 percent shy of the record high we saw a few years ago with gas at $4.11 a gallon as a national average. So we're not that far of and the refineries are a big, big problem, a big part of that.

Ed, thank you. SAMBOLIN: It is 33 minutes past the hour. An incredible story out of Detroit. A new report detailing how a bomb in a bag right there, set inside a federal building for three weeks, before it was actually found. This is according to the report. It was just released by Homeland Security.

A security guard at the McNamara building found the bag with an IED in it. Right outside the building, this is February of 2011. He tossed it under his desk. And at least two employees X-rayed it, but failed to identify what it was.

A federal inspector also overlooked it during four separate checks until two guards eventually grew suspicious and called in federal agents. Three guards have been fired, a fourth resigned. Five others were suspended. A Michigan man was later caught and charged with placing the device outside the building. Incredible.

HARLOW: Well, federal investigators trying to figure out how a regional commuter flight landed at the wrong West Virginia airport earlier this week. United Express flight 4049 supposed to fly from Morgantown to Clarksburg on Tuesday, landed instead 10 miles away at Fairmont Municipal Airport. The flight's operator, Silver Airways, apologizing to the 11 passengers on board, and the flight crew has been removed from service while the FAA tries to figure out what happened.

SAMBOLIN: Well, no wildfire relief for central and northern Oklahoma. Take a look at that. Emergency officials say the risk of fire danger will be very high to critical today. Forecasters expect high temperatures, increased winds and decreased humidity. There's a bit of good news here.

Firefighters say they are close to controlling the Lincoln county fire near Stroud, which is about 60 miles east of Oklahoma City.

HARLOW: And this story is pretty cool right here in New York City. They're unveiling a new high-tech crime-fighting tool for cops. It's called domain awareness system, or DAS. It was develop along with Microsoft. It lets law enforcement officials keep tabs on the city in real-time using street cameras, license plate readers, other resources that they have.

But on the flip side, civil rights groups already expressing privacy concerns. They don't like big brother looking in. In the next hour of EARLY START, we're going to talk about the new system. How it might help, if it's too invasive?

We're going to talk about it all with Lou Palumbo. He's a retired Nassau County police officer and also director of the Elite Intelligence and Protection Agency.

SAMBOLIN: This is potentially a great opportunity for the city to increase revenues as well.

HARLOW: They're going to make some money. SAMBOLIN: Yes, I'm so really interested. And some people are saying in maybe in high-crime areas, it could actually be a helpful tool as well. It's very interesting. I can't wait to learn a little more about the technology.

HARLOW: Lou is great, he knows all that stuff.

SAMBOLIN: All right. Thirty-five minutes past the hour. The field may be narrowing in the Mitt Romney veepstakes.

Ohio Senator Rob Portman, one of Romney's closest allies, sounding like he has little desire to be number two on the ticket. He made five appearances for Romney at campaign events in Colorado yesterday. And told CNN he actually likes what he's doing now.

(BEGIN VIDEO CLIP)

SEN. ROB PORTMAN (R), OHIO: I'm in the Senate, I just got elected two years ago, I think that's where I could end up staying and right now Congress is paralyzed. And we're really in kind of a partisan gridlock. We need leadership and that's where I intend to stay. I think I can really help in there.

(END VIDEO CLIP)

SAMBOLIN: Yes. He says Congress is gridlocked. They need leadership. He thinks he can help there.

Romney will be attending fundraisers in New York and New Jersey today. The president has campaign stops this afternoon in Pueblo and Colorado Springs, before returning to Washington, D.C. tonight.

HARLOW: I think it's interesting, you know, Zoraida, in terms of when we're going to find out who Romney's veep choice is. Some are saying maybe this week. but I heard Wolf Blitzer and John King who know all the inner workings in Washington saying smart bets are on next week.

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