As long as we're on the subject of California gasoline, here's an update on the ever-swelling difference between the price of gasoline in California vs. the Lower Atlantic:
When I last checked in on this in 2019, the California premium was a little over a dollar. Three years later it's continued rising and is now about $1.40, with a recent spike to $1.70.
That's far more than you can explain via either inflation or higher gas taxes. In percentage terms, the California premium has gone up from about 10% before the Torrance refinery fire to 40% today.
Back in 2019, gasoline expert Severn Borenstein was unable to figure out why the California premium had gone up so much. He could account for some of it, but there was a stubborn 30-cent difference that defied explanation. He called it the "mystery gas surcharge." Later that year the California Energy Commission published a report about the surcharge and ended up shrugging its collective shoulders: "the primary cause of the residual price increase," the report concluded, "is simply that California’s retail gasoline outlets are charging higher prices."
And that was that. Borenstein says that oil companies have stonewalled any real investigation, so the surcharge remains a mystery. No one knows why the California premium continues to go up and up.
They don't even really have to be colluding, just noting that they make very good profits at price X.
Also, California has a very high adoption rate of EVs. Interesting.
There's a form of semi-collusion called tacit parallelism. Best example is two gas stations across the street from each other, where one raises the price of gas by a cent and sees whether the other one follows. If not, the first station drops their price back down, but usually the second station will get the signal and follow.
IOW: they charge that much because they can. Fancy that!
I'm actually fine with this. If it's more expensive to drive (gas cars), it pushes people away from carbon emissions.
The part I'm not really fine with is it really fucks over less affluent people who need a car to have a not-shitty life.
a bit of a tangent...
Wired has a decent piece on negotiating Putin's loss:
https://www.wired.com/story/biden-putin-russia-lose-ukraine-war/
This war, and subsequent price increases in oil and gas prices mean fossil fuels usage will fall faster now.
This year, the high prices and the CA premium hurts. But next year, it will hurt less. Eventually, it will just be a minor annoyance, then it will fade away...
Difficult to imagine any negotiated end. The situation has evolved from an invasion to a sustained series of terroristic attacks, proceeding alongside a reign of terror in Russia. Putin apparently sees fear as his only strength now.
That's the perilous part.
Belarus hasn't joined in yet--maybe they see the writing on the wall....
Maybe Lukashenko will provide a safe haven for Putin?
Applebee executives' genius rationale for why higher gas prices are a great opportunity to cut employee wages,
https://imgur.com/gallery/SbHJYz0
Incidentally I've discovered why sometimes things won't post here,
it's when you make a typo or something that's abbreviated in a url creates a word that inadvertently looks like something that might be porn spam.
I have mixed feelings.
On the plus side. Less traffic, less pollution, moves us towards electric faster, boosts public transportation use, fewer crowds in my vacation spots.
Down side. Folks struggling to get by have their struggles worsen.
And personally, just as far as me, the benefits out way the costs.
By the way. I drive very little. Maybe every other day for 10 miles tops.
Living inside the beltway has its perks.
There was an article the other day in the LA Times looking at the outrageous premium charged by a couple of stations in the Beverly Hills area, which are routinely like a dollar more per gallon than the average SoCal price. The owner's answer? People are willing to pay it around there, so he's willing to charge it.
Refineries schedule regular "technical problems" each year to keep prices high because they found that people grouse and grouse, but will just pay it in the end and the oil industry has successfully neutered/bribed even the most progressive California politicians because they provide high-paying union jobs, so there's no blowback in Sacramento, either.
What are you going to do? Not get to work? You have to pay.
You go fill up at Costco.
There have always been expensive stations. You just don't go to them, it's a convenience charge of a dollar or two a gallon.
"... the oil industry has successfully neutered/bribed even the most progressive California politicians .."
Progressive politicians want high gas prices and the oil industry is happy to oblige them.
Well, the gas, at Costco, in the great NW is $4.29 for regular and $4.75 for premium. I am so glad I buy a gallon a month. This is insanity.
I guess there is no competition to drive down the prices. We need a special formulation to reduce pollution and that only comes from a few suppliers.
What neighboring states even have refineries?
Punishment for challenging IC engines
Kevin should lead a populist revolution to reduce gas prices in California by seizing refineries and whacking corporate executives.
Could this premium be the result of relatively ineffective public transportation systems in much of California? Most of the above responses seem to assume there is no alternative to driving a car. If that is true, there is your answer.
For a number of years I lived in Bloomington Indiana, a college town where students were above average in well to do. Gas prices there were always 20 to 30 cents more than towns just a few miles away. People were willing to pay, so the stations charged more. I think it's just that simple.
I don’t know if refiners are colluding to goose prices. Every plant take a shutdown once or twice a year. But then there is this:
SACRAMENTO (CBS13) — Gov. Gavin Newsom is proposing a $9 billion tax refund aimed at registered drivers in California, giving them $400 to help offset the recent spike in gas prices.
Many have spent the last 9 months complaining that pandemic aid has caused inflation and, I suppose, increased gasoline prices. So the answer is to give people more money again? This makes no sense. It will cause more inflation!
Or maybe these benefits have nothing to do with inflation at all. Who can say?
That's right! Giving people money causes massive disruptions to supply chains and causes wars! Take money from the people! Protect the supply chains!
Said premium being $1.60 if I’m eyeballing the chart accurately. That is 40% of $4.00. Perhaps things are different in Irvine, but in my corner of California, gas prices are more like $5.90…
Choose a cheaper station. It was 5.35 in Santa Cruz yesterday.
> No one knows why the California premium continues to go up and up.
? No one knows why corporations and companies continue to increase profits at the expense of their customers? It's like we don't even know what capitalism is.
Russian navy takes one for the team,
https://old.reddit.com/r/ukraine/comments/tm3rs1/one_russian_ship_is_sinking_two_damaged_ships/
This is not really that hard. There are a half dozen sizable refineries in California, all of which have repeatedly expanded over the decades and now completely fill their acreage. They can't grow, and NOBODY in California wants another refinery to be built in "MY backyard"!
So it's simple supply and demand. The companies know that if they charge more, there isn't going to be a Johnny-Come-Lately rush in and build a new refinery to undercharge them. In fact, they can make a plausible argument that they are reducing demand which they simply can't meet at least to some degree by charging more per unit they CAN meet.
No, refineries do not fill their acreage.
No, no one has proposed building a new one in he last four decades.