Gas Prices Stay High along the Environmentalist West Coast due to a Lack of Refinery Capacity

Posted by PITHOCRATES - May 20th, 2012

Week in Review

Take a look at an electoral map.  Say from the 2008 national election.  What do you see?  Blue (i.e., Democrat) on the coasts.  Red (i.e., Republican) in the middle.  And blue in the union Midwest.  Okay, now what else do you associate with the blue on the coasts?  That’s where there are high concentrations of liberals.  (The blue in the Midwest is more organized labor than liberal).  And what is one of the biggest issues with liberals?  That’s right.  The environment.  (I’ll just assume you said the environment).  Especially in California.  Where they have tougher emission standards than the federal government has. 

They take their environmentalism serious on the coasts. So much so that they punish the use of fossil fuels through high taxes and excessive regulations.  It is for these reasons you don’t see them building many new refineries in these regions.  For there are few things they hate more than petroleum oil.  From drilling it out of the ground.  To transporting it.  To refining it.  Their basic attitude towards the oil industry is, “Sure, you’re welcomed to do business here.  But you will pay.  And pay.  And pay.”  So with that in mind here’s a little story about high gas prices on the West Coast (see Unlike the East, gas prices stay stubbornly high out West by William M. Welch posted 5/18/2012 on USA Today).

“We are seeing a tale of two coasts,” says Michael Green, spokesman for AAA, which monitors pump prices. “On the West Coast, gas prices are rising steadily, while on the East Coast they are steadily decreasing.”

Oil analysts blame a refinery slowdown in western states for sending retail prices in the opposite direction of wholesale costs.

In California and Oregon, the average price of regular gas has increased 20 cents a gallon so far in May, AAA reports. Average pump prices were down 19 cents in Florida and 18 cents in Virginia…

Tupper Hull, spokesman for Western States Petroleum Association, blamed unexpected maintenance and other problems at refineries…

“Our concern is a lack of competition at the refinery level in California,” says Charles Langley, gasoline analyst at Utility Consumers’ Action Network in San Diego. “We’re not saying there’s a conspiracy. It’s just that with this few competitors, it’s very easy to game prices by turning off capacity.”

Bob van der Valk, petroleum analyst in Terry, Mont., said gasoline inventories are at a 20-year low in California for May. Supplies will return to normal, he said, but perhaps not in time for upcoming holiday travel.

The high prices on the West Coast are of their own making.  Prices have fallen on the southern half of the East Coast.  Because they aren’t as blue as they used to be.  They love their environment there.  Which is why they live there.  But they know they need petroleum oil and gasoline to live.  And they know that there is a direct correlation between anti-oil policies and the price at the pump.  Something they apparently don’t know on the West Coast.  For they hate oil.  Don’t want anything to do with oil in their state.  And yet almost everyone drives a car in California. 

If they want lower gas prices they have to make it easier to do petroleum business there.  That means they need to make it easier to refine gasoline in California.  Which means backing off on the taxes.  And the excessive environmental regulations.  They can do that.  Bring the price at the pump down.  And still have a beautiful environment.  Like they do on the southern half of the East Coast.

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