Spot on. Political bent aside, the main reason for the sudden spike is the change over to winter formulations and the self-created shortage they make so they won't be stuck with a bunch of gas of the wrong formula.

Speaking of which, see here:

http://www.clubcobra.com/forums/all-...ml#post1214209

That same topic contains a very good analysis of the localized formulation issue by Chip Beck.

Not to go all political, but I will!!! You can't have it both way's!! You can't say that ObamaCare is going to bankrupt the country and that free market should always set the price and then complain about the way the free market sets the gas/fuel price!! The president has almost no control on the world wide oil price unless he would open the strategic reserves and flood the market and drive the price of gas down. But then you would call that ObamaGas and claim it was the end of capitalism and the free world.

I also drive a jeep wrangler and I am riding my bike to work, 3.2 mi to save on gas and get back in shape. Jeep gets almost 15 rollin downhill with a tailwind. So I will drive less till we can make a change in washington. We need to get rid of the Solyndra saver occupying my house in washington and all of the ultra liberal freaks in Washington and California... Nuff said

Just remember...the number one export in 2011 was petroleum.

I love hearing people yell to drill more, yet the more we drill, the more they sell overseas on the open market.

http://www.washingtonpost.com/blogs/...vgSP_blog.html

To some extent it is political. I realize Obama has little directly to control the cost of gasoline, but he should not have been slammin Bush about the price of gas during his administration and Bush looking out for his buddies in Big Oil. Don't make the accusation, and hide form the same argument when the shoe is on Obama's foot. Secondly, the liberals fight tooth and nail to prevent any further construction of refineries. There are only a so many, and none have been constructed in many years. Things can be done politically, but it is not the political correct thing to do in the current leftist agenda. JMHO!!

As far as the Obama care goes in this argument, it the President limited the number of companies that provide insurance, think that might have an impact on the price, if only a few were controlling the distribution of the product. After all they are going to decide who when and what time the care will be limited, by the government stepping in a deciding. Don't sound like free enterprise to me

The exported petroleum was finished products like gasoline. We were still importing about half the oil we use. The gasoline exported allowed the refineries to run at efficient rates. If you cut the export of gasoline we would have imported less oil but would have run the refineries at less than optimum rates which would increase the production costs and probably result in more refineries shutting down.

Maybe this old article from Special Interest Autos (Aug 1981) will help. ;-)

http://blog.hemmings.com/wp-content/...ts_01_1000.jpg
http://blog.hemmings.com/wp-content/...ts_02_1000.jpg
http://blog.hemmings.com/wp-content/...ts_03_1000.jpg
http://blog.hemmings.com/wp-content/...ts_04_1000.jpg
http://blog.hemmings.com/wp-content/...ts_05_1000.jpg

I was in California in August and gasoline prices in the SF area were $0.20 cheaper then they were in Illinois. We here in the state of imprisioned governers (Illinois) have held the highest gas price gold medal for too long. If you really want to get annoyed, do a little research on where all the crude oil in the Alasken pipeline goes goes.

That cannot be true. Read the post right above you. The claim is that no new refineries are allowed to be built. That is the claim all the right-wingers have been whining about for years. Having excess capacity should have reduced the price of gas...unless certain corporations are rigging the system to keep prices high at certain times.

There were congressional hearings on this topic in 1995. Numerous oil executives stated that they do not want to build refineries. EPA regulations were irrelevant. They can keep prices high with limited capacity.

No oil has been exported from the North Slope since 2004. The total US exports of crude has been a maximum of 77,000 barrels per day in 2012 and all of it to Canada. Now we import almost 3 million barrels per day from Canada so I don't think sending them 77,000 barrels per day is much of a problem.

In some cases it would be better to export crude where the transportation cost is cheaper than importing a like amount of crude. There have been cases this was the case but the politics prevented it from happening.

By the way the major problem with California gasoline price is that it's a specific requirements that most refineries are not set up to produce so when you have a problem at any of those that produce California gasoline you can't import gas from other sources. The changeover from Summer to Winter gas and back just makes the problem worse

Many of the major oil companies have closed their smaller refinery locations sighting the cost to operate or upgrade them. Refining capacity is expanding all over the world, especially in countries like South America, Korea, Vietnam. And the fabrication of modular refinery units is mostly in done Korea these days. China's refining capability is now set to expand, in addition, they require most of the fabrication work to be done "in-country" too...

Who puts the price tag on the gallon of fuel?

Refineries? Politicians? Oil Companies?

NO, No and NO.

Before the gasoline hits your gas tank the oil was traded about 60 times. When investors pull cash out of the market the gas prices become low. When the market gets cash flow - the futures going up.

Insiders and their friends pulled cash in spring of 2008 from the futures. The result was an average gas price Summer 2008 of $1.81 - the real gas price.

Taking 100 billion dollar and invest in futures in three month spread, keep it with a small profit (just of the cost to move funds around) the government could keep the gas prices easily under $2 a gallon.
After 3 month you start the same cycle again. This boosts the economy and avoid to bankrupt the country.
Even your ordinary buns for breakfast increased by 30%, they claimed gas prices for the increase (it's a lie but this is besides the point) - they never came down afterwards.


To answer the question why CA has the high gas prices: because they "cook" a special blend --- reformulated gasoline program.
That puts the CA refineries in a bind because they "can't keep up with the demand". Which is set 90 to 120 days before - remember the futures?

And...a state sales tax of 2.25% on top of an 18.4 cent-per-gallon Federal excise tax and an 35.30 cent-per-gallon State excise tax.

So, it's a triple hit for the Californians - State, big bucks investors and their own refineries.

The refineries claim the high transportation cost. Hey, just drill for oil 6 miles a shore and tap into the massive reserves. About 300 years worth and the gas prices would be lower than the rest of the lower 48.

It was just on the news and the discussion was that there need to be more refineries in Cali in that none have been built for years, and the refinement has not kept up with the growth of the state or demand.

Bobcowan and Varmit's comments hit the nail right on the head.. You elected them, and you got what you asked for in CA. As to the refineries, they are not going to build more or improve them due to all the state and federal govt EPA rules. Due to CA having such restrictive gas blends you can't get gas from any other refineries in nearby states, because they don't make the CA blends. If more refineries close, you're going to see much higher prices and less gas available. Think 1987 and all the gas lines. Hope it doesn't happen to you, but I think the writing is on the wall.

California: Love it or leave it. Varmit: Please leave.

oh really!!! When and if I do it will be MY decision

There has not been a new oil refinery built in the US in over 30 years and as long as the EPA and other goverment agencys have their way, there will never be another oil refinery built, the restrictions are such that it makes it impossible to build a refinery from the ground up.....it's hard enough for the oil companies to expand and update what they have now.....

It's kinda hard for the rest of the country to feel sorry for you guys in California about the high gas prices when you'll are sitting on one of the largest known oil reserves in the country right off your coast and refuse to drill it......something about not wanting to ruin your veiw of the ocean with oil rigs on the horizon????
You have no idea how much better off your state would be with oil drilling off the coast. The commerce and jobs it brings in mind boggling........
Sorry guys,just can feel sorry for you when you have all the oil you need and refuse to use it.....
Maybe one day the citizens will wake up and vote the liberal tree hugging folks out of office and get some people in there that have a brain that actually works....

David

They probably do need more refineries, but regulations or not, they will not be built. There is no money in a refinery unless it runs at 90% or above capacity. They are not worth the work to build one. As we just saw in California, it is much easier to crank up the prices and limit demand than build a refinery. Heck, the distributors, stations, etc. probably made $2/gallon on gas they had sitting in the tank for the last month. Talk about a killing!

Chevron Richmond refinery spent about 5 years to get a permit to upgrade the refinery. The cost was 1 billion and would allow the refinery to process heavier cheaper crude. After starting the project a suit was filed and stopped the project. The folks who filed the suit could not understand why Chevron laid off the 1200 folks working on the project.

If you can't even get approval to upgrade a refinery what chance do you think you would get to build a new one. There was also a refinery in Southern California that was shut down for economic reasons. It was purchased by Christian organization. They tried to restart the refinery but could not get the approvals so it was dismantled.

The final point is the integrated oil companies make most of their money producing oil not in refining and marketing products. In the 31 years I worked for one there were only a few years that the refining end made much money. Several years they actually lost money.