8/4/2023 0 Comments Shell gas station![]() “The only thing you could point to are these very minor refinery repairs, which don’t explain it,” said CEC Commissioner David Hochschild. That has left the state’s Energy Commission staff, who are tasked with providing a window into the state’s oil industry, scratching their heads. Gas prices are displayed at a 76 gas station in San Mateo on Monday, Oct. Still, historically, price hikes of this magnitude are typically brought on by refinery catastrophes - and there have been none of those. Some of the reduced gas flow is due to an unplanned refinery outage in September and infrastructure maintenance that brings capacity offline, according to the California Energy Commission. The limited supply and strong fuel demand is causing gas prices on the commodity market to surge well above the normal gap between California and the rest of the country.īut what’s behind that drop in production is a bigger mystery. Through publicly available information, energy analysts know that the recent price spike is tied to reduced gas production among the state’s oil refiners, which include Marathon Petroleum, Chevron, and PBF Energy. “How do you do that without alienating your constituents with $10 gas prices?” How do you treat an industry that you want to put out of business?” said Tom Kloza, an analyst with OPIS, the Oil Price Information Service. Newsom’s call for a “windfall profits tax” on oil companies last week comes amid a new wrinkle in Golden State drivers’ long-standing misery at the pump. “Everybody scrambles to say, ‘Well, we should do something about this.’ And then the price goes back down and they and everybody go back to ignoring it.” “I wouldn’t even call it flying blind,” Severin Borenstein an energy economist at UC Berkeley, said of the commission. But the California Energy Commission, the state’s main energy policy body, can’t fully explain what is behind the punishing hike. Gas prices in California reached $6.41 a gallon on Tuesday – a dizzying 96-cent increase over the past two weeks – according to AAA. Gavin Newsom is quick to blame the oil industry for “ripping you off.” But even as Sacramento considers levying a punitive tax on oil companies, experts say state regulators have woefully little insight into an industry that zealously guards information on pricing and operations as confidential trade secrets. As Californians look down the barrel of gasoline prices just cents away from hitting another all-time record, Gov.
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