Because of oil refinery stoppages in California, gas prices have risen so high that independent gas stations are shutting down because they can’t make a profit.
Exxon’s Torrance refinery lost power Oct. 1 and is only starting to recover now; Phillips 66 is trying to fix two of its California refineries this month; and Chevron shut down its pipeline of crude oil to its Northern California refineries last month.
Meanwhile, Costco is starting to shut its pumps sown, Valero is terminating selling gas at its stations, and Exxon Mobil is rationing fuel.
Spot gasoline in Los Angeles has skyrocketed $1 a gallon this week to a record $1.45 a gallon premium versus gasoline futures traded on the New York Mercantile Exchange, the highest level since November 2007. Fuel is now averaging $4.3929 a gallon, while gas rose to $4.315 a gallon yesterday.
Bob van der Valk, an independent petroleum industry analyst in Terry, Montana, said: “The squeeze is on, and people are doing desperate things. The mom-and-pop gas stations are having to close down from either not being able to obtain gasoline from their regular distributor or cannot afford the break-even price of almost $5 per gallon.”
The California Independent Oil Marketers Association asked the state yesterday to expedite a waiver that would allow refiners to produce and sell winter-grade fuel.
California’s summer-blend fuel requirements are in effect until Oct. 31.