California wholesale gasoline prices eased as much as 12 percent Monday after Gov. Jerry Brown ordered the state’s Air Resource Board to permit refineries to sell winter-blend supplies.
Prices for summer blend gas had soared well above $4.09 a gallon at wholesale and above $5 at retail stations due to problems at three refineries that process summer-blend gas, which emit fewer pollutants than winter-blend.
The nation's most populous state has more vehicles than any other, so its pollition standards require different blends of gas for summer and winter.
Last week, Exxon Mobil Corp. (NYSE: XOM), suffered a five-day gap after a refinery in Torrance, Calif., lost power. That refinery is back online. Tesoro Corp.'s (NYSE: TSO) unit in Martinez, Calif., will close only briefly next week, Brown’s office said.
But a refinery owned by Chevron Corp. (NYSE: CVX) in Richmond, Calif., which suffered a fire on Aug. 6, is still offline. Chevron hasn’t said when it will be ready to resume operations.
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GasBuddy.com reported that retail gas around Los Angeles sold for an average of $4.69 a gallon Monday, down slightly from Sunday. San Francisco prices were around $4.70, down 2.3 cents.
Shifting California to winter-blend also could lead to greater supply from out-of-state refiners, said Stanley Young, a representative for the Air Resource Board. The increase in supply could lead to a drop of as much as 50 cents a gallon at the pump very quickly.
Shares of Exxon Mobil rose 13 cents to $92.68 in late Monday trading while those of Chevron rose a nickel to $117.55.