Price shock shuts down Calif. independent gas stations

Oct. 4, 2012

By Wayne Lusvardi

In a scene reminiscent out of the mid-1970’s oil shortages, it is being reported that independent gas stations are being shut down in California due to a shortage of supply and a resulting spike in wholesale gasoline prices.

Bloomberg news is reporting Costco has closed its gas stations in the Los Angeles and San Francisco areas.

San Diego Fox News Station Channel 5 is reporting that gas stations in the San Diego area may be shutdown by Sunday.

Reuters news service is also reporting that Valero Corporation has had to withdraw from the Los Angeles wholesale refined products spot market to assure supplies to its own retail stations.

At $4.90 per gallon for the wholesale price of gas vendors are reporting that there is no profit margin left even if they have gas.

This is reportedly an unexpected short-term crisis due to another one of California’s infamous “perfect storms” of events:

* California refineries are going through their seasonal Kabuki dance of converting to a different blend of fuel for the coming winter months to comply with clean air regulations.

* A fire at Chevron’s Richmond refinery also has compounded the supply problem.  The Richmond refinery is the largest in Northern California and has had to run at reduced production levels since a fire on August 6.

* An Oct. 1 power failure at Exxon Mobil Company’s Torrance refinery.

* Chevron’s Kettleman-to-Los Medanos Pipeline from refineries in the Central Valley to the San Francisco Bay area has been shut down since mid-September after elevated levels of organic chloride were discovered in the oil.  Organic chloride was formerly used by oil producers as a wax dissolver and is considered to be a contaminant. Organic chlorides can cause damaging corrosion to oil processing facilities in a matter of weeks.

* Phillips 66 has a scheduled shutdown of its processing units at its Rodeo and Los Angeles refineries.

“It’s a series of unfortunate events,” said Tom Kloza, chief oil analyst for Oil Price Information Service.  “This is not something that is going to last for months. This is something that is going to last for days or weeks.”

A waiver has been requested from state regulators to expedite the fuel conversion process for winter-grade gasoline.

38 comments

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  1. Rex the Wonder Dog!
    Rex the Wonder Dog! 4 October, 2012, 14:58

    Gas is a scam, a monopoly. In 1909 the Sherman Anti Trust act busted up Standard Oil into 39 separate companies, and today they have all merged back into 4 major US oil oligarques.

    Reply this comment
  2. Thomas Molitor
    Thomas Molitor 4 October, 2012, 16:30

    Rex, forget the Sherman Act and the “four major US oil oligarchies.”

    The energy markets are more political today. It’s not the old seven sisters that are the largest producers today, but rather politicized economies—the new seven sisters, which are all national oil companies that produce oil from deposits that the original seven sisters developed many decades ago. They haven’t brought in the modern technology and entrepreneurship to enhance and streamline these deposits.

    Again, Statism. Most of the major oil producing countries have nationalized their oil industry. We all know the fastest way to kill an industry is to have the government a part of the business.

    Another factor is that in a lot of these areas, the major exporters are soon to become net importers. Already, about half of what Saudi Arabia produces is consumed domestically, and Mexico may be unable to export oil by the end of the decade.

    Reply this comment
  3. ruth
    ruth 4 October, 2012, 16:58

    why is it that gas is being shipped from the richmond refinery to texas and mexico……this was immediately after the fire. i saw the tankers leaving…..and our gas prices went up right after the fire, even tho the gas on hand was purchased at the old price.

    Reply this comment
  4. Ulysses Uhaul
    Ulysses Uhaul 4 October, 2012, 17:14

    Poodle your a envy machine….wealth is good. Getting skills and getting paid well…good…..you should be pitied by your CWD gloom chums!

    Reply this comment
  5. Bob
    Bob 4 October, 2012, 17:25

    Look on the bright side, Wayne.

    Caulifornians (as Ahnode sez) are just getting a sneak preview and chance to adjust to $5 gasoline which with AB 32, peak oil and Helicopter Ben is inevitable.

    Reply this comment
  6. Dyspeptic
    Dyspeptic 4 October, 2012, 18:19

    But hey, who needs more domestic oil production?
    We don’t need no stinking Canadian tar sands oil.
    We don’t need no stinking Keystone XL pipeline.
    We don’t need no stinking offshore oil exploration.
    We don’t need no more stinking refineries.
    If we all save our used cooking oil and convert it to biodiesel then everything will be wonderful.
    How about those wind powered cars? I hear they’re the wave of the future.
    And whatever you do, don’t blame the high price of gasoline on The Dear Leader. Everyone knows it’s Bush/Cheney’s fault. Nancy Pelosi said so.

    Reply this comment
  7. Rex the Wonder Dog!
    Rex the Wonder Dog! 4 October, 2012, 18:34

    Teddy is a prolific sock puppet poster 😉

    Reply this comment
  8. us citizen
    us citizen 4 October, 2012, 18:48

    Just another excuse in the long chain. It’s always something. And every time ‘something’ happens, our rates go up. When the rest of the nation went to below $4, we stayed there. Aren’t we lucky.

    Reply this comment
  9. Hondo
    Hondo 4 October, 2012, 19:23

    Sec. Chu, Obama’s energy secretary, has said Amerika should have gas prices as high as they are in Europe. And guess what. They are getting there.
    The notion that there is a conspiracy is ridiculous, considering what Chu has said and all the high taxes and obscene regulations thrust upon Kali energy companies. The conspiracy is in the demoncrats party, in their hatred of Amerika’s energy producers. They have regulated the working class out of their cars so they can’t get to work even if there was a job to go to.
    Obama complained at the debate about all those corperate jets. I think he was talking about all those private jets flying into his fundraisers.
    The demoncrats have regulated themselves out of an economy in Kalifornia.
    Hondo

    Reply this comment
  10. SeeSaw
    SeeSaw 4 October, 2012, 21:28

    Well, what do you think about paying $4.99/lb for WA apples–in Washington! There are no migrant workers left to pick them, and they can’t get pickers at the usual wage–they are offering $18/hr.

    Reply this comment
  11. Rex the Wonder Dog!
    Rex the Wonder Dog! 4 October, 2012, 22:56

    Tell Clown his Prop 30 is REALLY DOA with $5 gallon gas.

    Prop 30 is going to be destroyed, 30 days baby, and I hope gas goes OVER $5 a gallon, when it does Clown will be hated more than Lex Luther, Bain and the Joker-even more than Teddy and the Sock Puppets.
    🙂

    Reply this comment
  12. BobA
    BobA 5 October, 2012, 08:03

    Hondo;

    You might also want to add that this Sec. Chu is an economic illiterate. He doesn’t seem to have a clue about how high fuels prices ripple through the economy in every imaginable way and force the prices up on everything else.

    And it kills me to think that there are people who think this administration is doing an excellent job despite the fact that they and anyone else who’s fortunate enough to have a job is being driven deeper into poverty and the number of poor people is growing.

    I guess it’s not enough for just them to be poor. They want everyone else to be poor right along beside them. Misery does indeed love company.

    The ultimate irony is that the rich are unaffected by current events and their money is mobile.

    Plus, I wish someone would explain to me how making a rich person poor helps me or anyone else.

    Reply this comment
  13. BobA
    BobA 5 October, 2012, 08:26

    Rex:

    Gas here in the San Diego is near $5/gal already and is predicted to be close to $6/gal by the end of next week. Independent gas stations are also shutting down as thet run out of gas and if things don’t improve by the end of next week, we could be facing a major crisis in California.

    More and more eople are already parking their cars and staying home because of the high gas prices and it’s just a matter of time before delivery services and other businesses that use high volumes of fuel on a daily basis do likewise. Daily commerce will inevitably come to a screeching halt at some point.

    Meanwhile, our state politicians are content to sit on their dirty & greedy hands and do nothing. They hardly give a damn if the middle and lower classes suffer. As long as their coffers are full and the monied interests line up to kiss their asses and line their pockets, why should they care or do anything?

    Reply this comment
  14. Douglas
    Douglas 5 October, 2012, 08:57

    Did gas prices double under Obama?

    In the summer of 2008 — President Bush’s last year in office — gasoline prices climbed above $4/gallon for nine straight weeks. The DOW was over $1,300.

    By December, just before President Obama took office, gas was below $2/gallon. The DOW was under $7,000.

    So gas prices doubled in the last four years, but they are about the same as four and a half years ago.

    Is that a bad thing?

    Gas in Modesto today is $4.

    Reply this comment
  15. BobA
    BobA 5 October, 2012, 09:29

    Douglas:

    High gas prices is not a bad thing -if you’re rich. Gas in my neighborhood jumped to $4.72 this morning. I could drive about 6 miles and buy it for $4.49 if it’s available. A number of independently owned gas stations have shut down.
    Didn’t Obama say that under his energy plan, fuel and utility prices will necessarily go up> And Sec. Chu believes US gas prices should be on a par with European gas prices (i.e., $9 -$10 per Gallon).

    Reply this comment
  16. Tom in SoCal
    Tom in SoCal 5 October, 2012, 09:46

    Don’t forget that California has it own special blend of gas that only is and Arizona use. Why???

    Let’s use the same blend as other states

    More gas = larger market= better competition = lower pricing

    Reply this comment
  17. Ulysses Uhaul
    Ulysses Uhaul 5 October, 2012, 10:07

    What do you care? Your manning your bunkers in your thrift shop robes 24/7.

    Gas is not your worry……try sanity.

    Reply this comment
  18. Rex the Wonder Dog!
    Rex the Wonder Dog! 5 October, 2012, 10:38

    Douglas says:
    The DOW was over $1,300.

    Huh??????
    Dougie babie, what do you mean the dow was over $1,300?????
    😉

    Reply this comment
  19. Rex the Wonder Dog!
    Rex the Wonder Dog! 5 October, 2012, 10:40

    Gas in Modesto today is $4.
    ==
    Yipeee!!! Gas in Modesto is only $4, I am moving!

    Are the water slides still open in Manteca??? Could use some relief from the hot sun……….

    Reply this comment
  20. Ulysses Uhaul
    Ulysses Uhaul 5 October, 2012, 11:20

    Poodle…..take a nap!

    Reply this comment
  21. Hondo
    Hondo 5 October, 2012, 11:35

    All Romney has to do to finish off Obama is to compare Obama’s policies to the same ones that have destroyed Kali. Obama’s energy policy he wants to inflict on the country is the same one that has been in place in Kali for the last 20 years. And look at the result. When Amerika is nearly coming out of the downturn, these huge gas prices are drop kicking the recovery in the the nuts.
    I recently had a family problem in the mountians near Big Bear. An aged family member needed help. The closest family was in LA and that was more than 50$ in gas they simply didn’t have to drive up there. They were in between pay checks. Luckily we found a neighbor to help my aunt Shirley. These are the choices we non rich people have to make now. We are trying to get aunt Shirley to move out of the mountians, but we don’t have the money and she is old and blind and scared. Her house is in forclosure and I’m going down to by a lotto ticket right now. Maybe God will smile on me and aunt Shirley.
    And you think my family is the only one having to make these horrific choice. Food on the table for kids, or gas to drive hundreds of miles to help a poor old aunt.
    Enough whining. Come on Lotto!!
    Hondo……

    Reply this comment
  22. BobA
    BobA 5 October, 2012, 11:36

    Ulysses Uhaul:

    Come on man! A you tacitly implying that it is you who don’t care what gas prices are or how high they go? I knew it, I knew it, I knew it!! You’re just a rich guy who gets a kick out of rubbing it in and peeing on the less fortunate. It figures.

    Reply this comment
  23. BobA
    BobA 5 October, 2012, 11:50

    Hondo:

    I fell your pain man. I myself have relatives suffering because of Obama’s policies and they voted for him! Guess which brother saved their home from foreclosure? Guess which brother has been loaning them money with little prospects of getting it back if at all? And they still like Obama and don’t like me much because I’m an “evil conservative”!

    Reply this comment
  24. Hondo
    Hondo 5 October, 2012, 11:51

    I’m sorry for dragging my family into this. I get a little emotional about these things.
    Hondo…..

    Reply this comment
  25. BobA
    BobA 5 October, 2012, 14:22

    Me too Hondo. The crap that goes on in this state is frustrating to no end and it’s painful and angering to watch loved ones get hurt by it.

    Reply this comment
  26. Sean Morham
    Sean Morham 5 October, 2012, 14:56

    We are traveling on a path towards societal breakdown in parts of Kalifornia.
    Chomp, chomp. Here come the hungry hordes knocking on doors looking for nourishment…..Mad Max with cannibals and subtitles….

    Reply this comment
  27. Ulysses Uhaul
    Ulysses Uhaul 5 October, 2012, 17:40

    BoBA
    Personally don’t care how high things go. I ate mashed potatoes nightly as a child and had one pair of long pants and a pair of Tom McCan shoes. Not an CWD delusional whiner or an nternet or cell phone pussey like most you. I am a survivor!

    Reply this comment
  28. BobA
    BobA 5 October, 2012, 18:20

    Ulysses Uhaul:

    You ain’t the first person who grew up poor and won’t be the last. My life’s beginning is far more humbler than yours but I’m not complaining. I’m alive and a tougher person for it having lived through it and that’s all that matters. Apparently I must’ve struck a nerve by the way you lashed out.

    If you don’t care about how things go or what’s happening to our state then why are you here? Saying you don’t care how things go is a provocative statement and reveals more about you than I think you intended or care to admit.

    Reply this comment
  29. Rex the Wonder Dog!
    Rex the Wonder Dog! 5 October, 2012, 19:15

    Personally don’t care how high things go. I ate mashed potatoes nightly as a child and had one pair of long pants and a pair of Tom McCan shoes
    ==
    See, that was YOUR problem fool, you **should** have bought PF Flyers like me, and your life wouls be OK 😉

    Reply this comment
  30. Ulysses Uhaul
    Ulysses Uhaul 5 October, 2012, 20:22

    BobA

    I am here watching your types blow gaskets…fun…real fun.

    Reply this comment
  31. Rex the Wonder Dog!
    Rex the Wonder Dog! 5 October, 2012, 21:41

    Teddy, I am here watching your sock puppets post gabage…fun…real fun 😉

    Reply this comment
  32. Ulysses Uhaul
    Ulysses Uhaul 6 October, 2012, 08:40

    BoBA. Gas up…..higher…..higher……infinity

    Gas or burgers? Or bunker maid services..

    Same some for Prop 30……save the kids.

    Reply this comment
  33. BobA
    BobA 6 October, 2012, 09:13

    Ulysses Uhaul :

    That’s more like it. No need to get all indignant and take things personally. This is a discussion forum and we’re all civilized adults here. Let’s all have fun at each others expense while we “debate” the issues.

    Blow a gasket? Man, that is so passe. Try blowing a fuse or pop a nerve. By the way, no meat with those taters? Tom McCan shoes? Where I came from only well to do people could afford those kind of shoes. Ever wore “Seemore” shoes? You know, the kind of shoes were you see more feet than shoes? Been there done that.

    BTW: I’ll take the bunker maid service if she’s pretty. And I don’t eat beef or pork so forget the burgers unless it’s a turkey burger.

    Reply this comment
  34. Ulysses Uhaul
    Ulysses Uhaul 6 October, 2012, 11:41

    There are no issue debates on CWD
    Frankly, I do not read much of this doomer crap…bad for the ribs..laughing at CWD miserable posts.

    Reply this comment
  35. Ulysses Uhaul
    Ulysses Uhaul 6 October, 2012, 11:44

    BoAB

    CWD posters are too cheap to get a cute, perky bunker maid…..and lib chicks are way to intelligent to deal with garlic smelling Adelanto cavers…

    Reply this comment
  36. Rex the Wonder Dog!
    Rex the Wonder Dog! 6 October, 2012, 23:29

    $5/gallon gas is b/c of public unions.

    Reply this comment
  37. Queeg
    Queeg 7 October, 2012, 13:56

    Desert rats will gst $5.50 fuel and beg for more!

    Reply this comment
  38. BobA
    BobA 7 October, 2012, 15:56

    Ulysses Uhaul:

    Dude, you need to cut back on the Kool-Aid drinking. Next thing you know you’ll be telling us all how hot and intelligent Nancy Pelosi is. You have very very low standards and I have a pencil eraser that’s smarter than your dear Nancy.

    Reply this comment

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