California gas prices

[rms427]

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.

[joyridin']

Originally Posted by rms427

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.

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.

[Blas]

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...

[G-Pete]

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.

[Varmit]

Originally Posted by joyridin'

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.

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.

[joyridin']

Originally Posted by Varmit

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.

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!