California Gas Prices Ease After Brown Orders Blend Changes

By @DavidZie on
  • gas_prices_california_oct_2012
    A California gas station used upside down '2s' to list $5 per gallon gasoline prices. Gasoline prices in California will fall now that Gov. Jerry Brown has ordered a shift to winter blend after refineries making summer blend went offline.
  • View of the Exxon Mobil refinery in Baytown, Texas
    The Exxon Mobil refinery in Baytown, Texas (photo from September 2008)
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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. 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.


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