Sunday, March 22, 2015 – 10:00 a.m.
California motorists continue to get screwed. Even as Crude Oil prices continue to slide.
A slide likely to continue for some time.
While neighboring states enjoy gas prices well below $2.50 per gallon. Prices in the Golden State hover north of $3.00 per gallon.
Now excuses like, “It’s the summer blend.” “It’s a nervous market!” “It’s the refinery shutdown.” or “It’s the refinery strike.” just don’t seem to wash any longer.
California refiners are sticking it to everyone, and they’re making tens of millions of dollars in profits doing it.
By all accounts, every analyst is predicting the price of crude oil, currently at $46.45 (WTI/May 2015), will fall below $40 per barrel, with the low estimate down at $18. Prices actually hit fresh low’s earlier in the week.
The oil production glut is rapidly filling up available storage space in the nations main facility at Cushing, OK. Expect that facility to reach capacity sometime in May.
According to the Energy Information Agency (EIA), there’s been more than 71 million barrels of excess inventory created the past eight weeks. Current forecasts show no drop-off in production on the horizon.
Now to the California gasoline refinery front.
Remember the “California gas supplies will be limited” story? Well of course there was never any problem with the state’s gasoline supplies. The latest report from the California Energy Commission says as much.
Crude Oil prices sit about 4.7% above the January lows. In essence the big February spike in price has evaporated.
Inland Empire regular unleaded gasoline sits around $3.09 per gallon. That’s 90 cents, or 41.1%, more per gallon from the January low.
With the nationwide refinery strike ending. It’ll be interesting to hear the next spin to keep California prices higher.
Here’s some average state gasoline prices according to Gasbuddy.com. They are average prices. Not the lowest prices.
California 3.272 Hawaii 3.161 Nevada 2.825 Arizona 2.392 New Mexico 2.224