Posted on 03/02/2007 7:59:19 AM PST by newzjunkey
The stock market may have stumbled this week, but gasoline price increases continued unabated.
The average price of regular gasoline in San Diego has risen to $2.84 per gallon, up nearly 14 cents in a week, according to the Utility Consumers' Action Network.
One year ago, gas prices in San Diego were 33 cents per gallon lower than they are today, said Charles Langley, who oversees gasoline monitoring for UCAN, a local watchdog group. "We have never seen prices this high in February," he added.
Langley said the higher costs could not be justified by the price of crude, the commodity from which gasoline is refined.
Crude oil prices last year at this time were higher than now – $67.56 per barrel versus $61.79 for benchmark crude on the New York Mercantile Exchange.
All things being equal, this year's nearly $6 per barrel cheaper crude oil should have lowered the cost of producing gasoline by about 14 cents per gallon.
The petroleum industry has long said that crude oil costs are just one factor in gasoline pricing, the others being supply and demand.
While the Western States Petroleum Association – a trade group representing refiners – did not return calls, the California Energy Commission said it had identified some factors that could be responsible for higher pump prices.
Susanne Garfield, a commission spokeswoman, said some refiners have had difficulty returning to full production, after transitioning their facilities to produce the summer blends of gasoline required by state regulation.
The loss of production, she added, has caused suppliers to dip into inventories and sent others to the spot gasoline market for purchases they otherwise would not need.
Garfield said the state generally produces about 90 percent of the gasoline it consumes, requiring imports to fully satisfy demand.
“We live on the edge, and one little glitch will drive up wholesale prices,” Garfield said.
The energy commission's weekly gasoline report reported a decline of 0.3 percent in gasoline inventories for the week ended Feb. 23. But the report also indicated that gasoline production rose about 8 percent during the same week.
Garfield said the production increase could be misleading because the state has been producing gasoline at below adequate levels.
“I can't explain the gasoline price increase, but I can give you some of the factors that may be involved,” she said.
Langley, of UCAN, said there was another factor at work. He and other consumer advocates maintain that a small number of petroleum companies have a stranglehold on refinery capacity, which allows them to manipulate prices for their profit.
“Yes we have refinery turnarounds and yes we produce less gasoline now that we have shifted to summer blends,” Langley said, “but there is no good reason why our gas is costing 30 cents more this year than last.
“It really appears to be a tremendous amount of gouging.”
The federal Energy Information Administration reported this week that gasoline prices nationwide rose to $2.38 per gallon, up about 9 cents in a week and 13 cents higher than last year at this time.
Prices throughout California increased to $2.80, 9 cents higher than the previous week and 36 cents above last year, according to the EIA.
Aside from the West Coast, which had a 28-cent increase, the next highest increase was seen in New England, where prices climbed to $2.36, up 9 cents in a week and 14 cents higher than last year.
Once again San Diego, a Big Oil "get healthy" market, is getting hit harder than market forces can justify.
Gas prices are up because Americans are trying to drive far enough to get away from all the Anna Nicole Smith coverage.
{ {{ PING San Diego Area Freepers PING } }}
Once again San Diego, a Big Oil "get healthy" market, is getting hit harder than market forces can justify.
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Many prices in the Bay Area are OVER $3.00 per gallon. There is no justification -- just greed.
A monopoly can charge whatever it wants for as long as people will pay it. This is why we need an alternate fuel.
There's a place you can do that??? WHERE?
" The petroleum industry has long said that crude oil costs are just one factor in gasoline pricing, the others being supply and demand. "
Demand by Al Gore and his supporters.
I just wish they would quit buying gasoline.
It is also the Democrats' fault for not allowing us to drill for more of our own oil or build or own refineries. I wonder if there's any way Bush or any other president could use the military as a cover for such actions, under the power of being CiC?
They're trying to coerece Al Gore into reducing the size of his "carbon footprint".
Check the accuracy of your chart. It goes out to 3/29 (4 weeks from today) and has a price of $57 and change whereas the spot price this morning is $62 and change.
Greed? Collusion?
You are correct...one poster here indicated "is getting hit harder than market forces can justify"...so true. But, as you can see, there are many here who post charts that indicate there is no gouging, no price fixing...they ignore the reality there is...Perhaps a nickle, a dime above where the prices should be but multiply that by the billins of gallons purchased per day...One moron trying to justify out of whack prices where a gallon of gas price goes up the same day as a barrel price increase (depite lag time of at least a week to see that gas make to the pump) indicated it was bacause station owenrs had to charge more so when they had to buy the new inventory they had the additional funds to do it.Well, with that logic when barrell prices go down shouldn't the price at the pump fall immediately since they neeed less money to secure new inventoey a week away? The clear point that showz one is being gouged is that when gas prices spike for barrel, within a day there is an increase at the pump...when they drop appreciably that savings does not show up at the pump for weeks at times...Clearly, this is price fixing and gouging...But now you will see all those who defend big oil print their charts that seems to suggest that does not happen when we all know it does...I guess they have a ton of money in oil stocks...they want to justify the gouging, they make money off of it after all.
However, investing in a refinery is a risky proposition because the government is likely to change the regulations or activists are likely to sue and delay or stall indefinitely the construction of the refinery. That means the builder could end up with many millions of dollars of assets tied up in a project that it stalled, and may not be very profitable when it gets completed because the government my tax or regulate away all the profits.
I have heard that ExxonMobil are shutting down all their Mobil stations in Maryland. Anyone know anything about that?
I have heard that ExxonMobil are shutting down all their Mobil stations in Maryland. Anyone know anything about that?
I have heard that ExxonMobil are shutting down all their Mobil stations in Maryland. Anyone know anything about that?
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