October 4, 2012

Why are California Gas Prices Going Up?

Why are California gas prices going up?

source: Bloomberg

Brent and WTI oil prices have been generally trending lower, so why are California gas prices at the pump shooting up?

Reduced outputs at oil refineries owned by Chevron, Exxon, Phillips, Shell, Tesoro and Valero.

Per Bloomberg,

  • Chevron’s Kettleman-Los Medanos oil pipeline is shut down due to higher levels of organic chlorides in the oil - affects output at Shell, Tesoro and Valero refineries
  • Exxon Mobile’s Torrance refinery’s output is down due to a power failure
  • Chevron’s Richmond refinery is still at a reduced output

  • And, Phillips’s Rodeo and Los Angeles refineries will go into maintenance in October.

Independent California gas stations without long-term contracts are shutting down due to the record-high spot prices.

Will it be $5/gallon gas in California?

Tags: high california gas prices, gas price going up, $5/gallon gas in california, california pump gas prices