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.
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.