Bracing for higher prices at the pumps

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Amid news reports of national gas prices going down, Californians are living a different story.

Three of the state's refineries have reduced production recently, resulting in an increased wholesale cost to gas stations, which will be passed on directly to drivers. Those refineries are Tesoro Petroleum Corp. and Shell Oil Co. in Martinez and Valero Energy Corp. in Benicia.

"It seems very suspicious that all three refineries are down at once," said David Polanco, owner of the Junction Fuel Stop on Highway 108 in Sonora. "How convenient. Now they have to raise prices."

Polanco said his wholesale price has gone up 24 cents in nine days, so he must raise prices at the pumps. At one of his gas stations in Camino, the price went up 10 cents overnight, he said.

Kashmir Thandi, owner of the Gas Mart in San Andreas, echoed Polanco almost verbatim his wholesale cost has gone up 24 cents and his prices at the pump have also gone up 10 cents. He'd heard about repairs at California refineries causing the price increase, but said, "I don't know if it's true or not."

Whether the outage is the cause of higher prices, one thing is sure: There is less gasoline.

Tesoro's Golden Eagle refinery has shut down a boiler for repairs, resulting in a loss of about 20,000 barrels per day of California Air Resources Board-approved gasoline with ethanol, and 25,000 bpd of diesel, said Tara Ford, director of public relations and corporate communications for Tesoro.

Ford said she's awaiting word from the refinery on how long repairs will take. The Martinez refinery usually produces about 560,000 bpd and is Tesoro's largest plant.

Forbes magazine reported Tuesday that Shell's Martinez refinery is undergoing maintenance, although a spokesman wouldn't comment on what sort of maintenance, exactly. Forbes also reported that Shell's 100,000 bpd Wilmington refinery near Los Angeles is also said to have a coker shut down, although further details about that were not available, either.

The Union Democrat
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