California Gas Prices Up 45 Cents. Why?

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In my local newspaper (in Idaho) there was a story that over the last week, gas prices in CA have risen by around 45 cents/gal! The reason given is "unexpected demand", which smells like market manipulation to me.

Gas prices in north Idaho are highly influenced by CA prices. Since February, our prices have been about 25-30 cents above national averages, because of a February refinery fire in CA. They are now expected to rise even more.
 
Average regular in Orange County went up about 75-80 cents the last 2-3 weeks.

Low supply(1 refinery down for maintenance) high demand(more SUV & minivan) = high price. Very few refineries outside CA can produce special blend, when the price was fairly low the last several months they didn't bother making CA blend, now the price is higher they started to produce CA blend and ship to us. Some predicted that the price will be lower in about 2-3 weeks.

There is no manipulation on supply & demand & price by any oil company. Every time when we had substantial price hike both state and Federal investigators didn't find illegal activity from oil companies.
 
Sounds like as good of a reason as any to me. Been threw this countless time up down up down.

I just find it funny how the global demand for gas is still low the market is still flooded and yet prices still rise here in the US.

It's still up a dollar from 6 months ago. Which is kinda sad as now the prices simply reflect "refinery problems".

I know it's still considerably lower than it was but I'm just waiting for something to happen where they can jack the prices to all time highs.

It's essentially like giving gold refiners the authority to set global gold costs based on how many problems they say they have run into.
 
The oil companies are also raising the price big time (second time this year I believe...first in Jan) to pay for AB32..the carbon tax...which many people and commentators have forgotten.
 
When it first went up, the oil companies claimed they exported too much and the supply was low. Then the next day they decided the refinery was offline and that was the reason. I think I would be less upset and were just honest and say "because we can"!
 
Prices are expected to fall by 70 cents a gallon for gas when the Iran deal kicks in. Think thats in about 3 months. Their oil on an already flooded market will push prices down.

But of course if a retailer can sense they are the only game in town (a "captive market") then prices won't budge much in favor of local profits.

http://money.cnn.com/2015/07/14/news/economy/2-gas-iran-nuclear-deal/
 
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More gets used in the summer, so it's not a big surprise. Ours went up similarly recently. It fluctuates a lot lately, and it's still better than it was, which is better than nothing, I suppose.
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If the Iranian oil glut came to pass then my expectation is that the projected 70 cents a gallon would morph into 10-15 cents a gallon by the time this crude hit the U.S. market. It would also likely have proportionally less of an effect on "clean air" gas states like California than elsewhere in the country.
 
Originally Posted By: morepwr
When it first went up, the oil companies claimed they exported too much and the supply was low. Then the next day they decided the refinery was offline and that was the reason. I think I would be less upset and were just honest and say "because we can"!


The actual reason for the latest spike in Southern CA is a delay in imported product reaching Southern California. Northern CA is not as affected.

They are having to import more than usual because refineries are still operating below capacity. That's something that has been going on for months now.

Those who talk about regulations, taxes, more demand have just been brainwashed. CA uses less gas now than 10 years ago. It is a huge market and should have enough reliable supply and capacity. The price differential due to taxes and CA requirements is far less than the actual premium CA consumers pay.
 
The price for regular in the burbs outside Salt Lake City is $2.79/gal.

I am so glad on many levels I left So. Cal.

Made a lot of money there though!
 
Originally Posted By: Benito
Originally Posted By: morepwr
When it first went up, the oil companies claimed they exported too much and the supply was low. Then the next day they decided the refinery was offline and that was the reason. I think I would be less upset and were just honest and say "because we can"!


The actual reason for the latest spike in Southern CA is a delay in imported product reaching Southern California. Northern CA is not as affected

They are having to import more than usual because refineries are still operating below capacity. That's something that has been going on for months now.

Those who talk about regulations, taxes, more demand have just been brainwashed. CA uses less gas now than 10 years ago. It is a huge market and should have enough reliable supply and capacity. The price differential due to taxes and CA requirements is far less than the actual premium CA consumers pay.


Ca gasoline consumption has basically been flat since 2009 and down less than 10% compared to 2006 although for the first quarter of this year consumption is the highest since 2008. AB 32 is real as far as an increase in pricing. How much I don't know how we find that out.....estimates have ranged from .15-$1.00 gal. In any event we are paying more.....
 
The majority of Californians are the only people in the whole world stupid enough to vote in tax increases on themselves.I won't talk about how corrupt the government is as that may be considered political.
 
Originally Posted By: Benito
……….The actual reason for the latest spike in Southern CA is a delay in imported product reaching Southern California.


Imported from where? Utah refineries?
 
Originally Posted By: SubLGT
Originally Posted By: Benito
……….The actual reason for the latest spike in Southern CA is a delay in imported product reaching Southern California.


Imported from where? Utah refineries?


From overseas apparently.
 
Originally Posted By: Benito
The actual reason for the latest spike in Southern CA is a delay in imported product reaching Southern California. Northern CA is not as affected.

They are having to import more than usual because refineries are still operating below capacity. That's something that has been going on for months now.

Those who talk about regulations, taxes, more demand have just been brainwashed. CA uses less gas now than 10 years ago. It is a huge market and should have enough reliable supply and capacity. The price differential due to taxes and CA requirements is far less than the actual premium CA consumers pay.

There are 3 main reasons CA gas price are higher than national average:

1. Special formula that costs about 10-15 cents extra per gallon.

2. Higher tax, on average we pay about 25-30 cents more tax per gallon. We have state excise tax and sale tax of whole sale price(tax over tax). This higher tax and special formula combined makes our price about $50-70 cents higher than national average most of the time.

3. Limited supply, since we have special formula not many out of state refineries can product our blends, and lately they didn't ship as much as the last few years into California. There are few refineries in state and no new one had been built for more than 30 years, any disruption in supply will cause price spike substantially.

Yes, the oil companies do take advantage of the low supply to charge more for gasoline they sell to distributors, but when they try to expand their facilities they had a very hard time to get permit.
 
The spikes and price differences are unprecedented. Just look at the graphs I linked to.
 
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