Santa Monica, CA – The three major refiners that provide detailed profit information reported their best ever year to date from oil refining in California. Each company at least tripled their average historical profits in the third quarter, according to Consumer Watchdog’s analysis released today.
The huge increases followed a record year for California gas prices – reaching as high as $1.20 above the national average for the first time in history. (The previous high had been 80 cents.) In the last nine months, Californians have paid $7.5 billion more than they should have for gas, according to the report. In Los Angeles, prices remain 75 cents higher than the per gallon national average, double the usual gap.
The report concludes, "2015 has emerged as a new era in California refining –record prices, record profits, and record influence peddling."
Refiners in California spent record amounts on lobbying this year, matching their threefold profit increases. All of the companies examined spent more on lobbying in the first 9 months of 2015 than any year prior. The oil industry as a whole, including the state’s biggest refiner, Chevron, and the state’s leading lobbyist, the Western States Petroleum Association, spent $11 million.
“Price-gouging in California is creating a second Gold Rush for oil companies,” said Cody Rosenfield, the report’s researcher. “Oil refiners protected their Golden State gouge with gold-plated lobbying. Californians and their representatives should be outraged.”
Read the report here: http://www.consumerwatchdog.org/resources/OilProfitReportQ32015.pdf
SB 350, Governor Jerry Brown’s signature climate change legislation, was stripped of the mandate slashing oil use in half by 2030 due to unprecedented oil industry lobbying. The oil industry has also avoided scrutiny by regulators.
While Valero & Tesoro provide California-specific information regarding their operations, the majority of refiners do not provide detailed profit data for the state. Chevron, the state’s biggest refiner, does not break out profits for specific states. It posted its best ever quarter for refining in the United States, the company’s financial data showed. More than half of the company’s refining takes place in California.
When the California Energy Commission’s Petroleum Market Advisory Committee meets in December, Consumer Watchdog will recommend that every California refiner provide state-specific profit information including per barrel profits, and overall statewide profits. Currently, Valero and Tesoro provide the most information. The other major California refiners provide almost no California-specific information.
Consumer Watchdog will also ask that refiners be required to notify the public and regulators about planned maintenance in advance and how they plan to make up for any shortfall in production
Consumer Watchdog’s findings include:
• Valero, California’s fourth largest oil refiner made $342 million in California from refining, its best quarter ever in the segment. The sum is six times Valero’s average profits since 2010, and twelve times more than the company made in the same quarter last year.
• Tesoro, California’s second largest refiner, made $770 million from California refining, based on a Consumer Watchdog analysis of their financial data. This is four times its average profit since 2010, and its most profitable quarter ever in California. The company made a whopping $16.03 per refined barrel.
• Chevron, the largest refiner in California, made $1.2 billion on refining in the United States in the third quarter – its best quarter ever. 54% of Chevron’s refining takes place in California, which boosted high profits.
• Chevron, Tesoro & Valero spent more in the first nine months of 2015 than any other year in history.
• Valero spent a record $582,587 on California lobbying in the 3rd quarter of 2015, the most it has ever spent.
• Tesoro spent $130,046 in the quarter, four times its average spending since 2005.
• Chevron spent $1.8 million in the 3rd quarter, dwarfing its average spending of $500,000 since 2000.
• The oil industry’s major California trade association, the Western States Petroleum Association, spent a record $6.7 million in the quarter – the most of any lobbyist for any industry.
Throughout 2015, Consumer Watchdog and philanthropist and environmentalist Tom Steyer sent letters to California leaders urging action on California’s major, but still unjustified, gas price spike. In March, Consumer Watchdog and Steyer called on legislators to subpoena oil company executives to appear before them and explain California’s price spike.
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