Refiners push up gas prices in CA today: L.A. Times

A sharp letter to the editor this past weekend alerted me to a startlingly good Los Angeles Times story I had missed on California's high gas prices, complete with a graph that almost tells the story itself.

Here's the letter, from Jim Cody of North Hollywood: 

The graph that accompanied this article, which shows how crude oil
, taxes, refiners and station owners have influenced the price of
recently, proves that practically all of the recent run-up in California gasoline prices is going to the refinery owners: Chevron, Tesoro, BP, ConocoPhillips, Exxon Mobil
and four others. Chevron, BP, Exxon Mobil and ConocoPhillips are, along
with Shell, the five largest oil companies in the world, and in 2011
they made record profits of $137 billion.

Since only one segment of the
gasoline supply chain is profiting from this price run-up, it is hard
to believe that this segment is not also solely responsible. The oil
companies say they are not actively colluding to set prices; since they
aren't, they have apparently developed some other price-gouging method
that is just as effective and just as destructive to the economy.

time an oil severance tax has come up for consideration in California,
the oil companies have warned that that would raise gas prices. Turns
out that gas prices are going to go up anyway, but at the oil companies'
convenience. At least if we pass an oil severance tax, we will get
something out of it, just like the socialist states of Alaska, Texas and

Here's the story, with a partially anecdotal opening:

"You can't believe how customers talk to me," said [gas station owner] Arya, who was born
in India but has lived in the U.S. for almost 40 years. "They say, 'You
foreigner, you're gouging.'"

While Arya was losing money, the
state's oil refiners were raking it in. For the week that ended Oct. 8,
when the average price for a gallon of gasoline in California hit a
record high of $4.67, the portion of the retail price going to refiners,
or margin, jumped to $1.22 a gallon. That was up 75% from the previous
week. And it was nearly triple the average margin of 42 cents a gallon
this year, according to California Energy Commission data.

And here's the exemplary charticle, mentioned in the letter above. 

Note that air pollution regulation did help create the "gasoline island" that these oil refiners now exploit. 

Published by Kit Stolz

I'm a freelance reporter and writer based in Ventura County.

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