Shell refinery closure called move to drive up gas prices

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Sacramento Bee

A consumer advocacy group Tuesday renewed its charges that Shell Oil Products is manipulating gasoline prices by closing and demolishing its Bakersfield refinery later this year.

The Foundation for Taxpayer and Consumer Rights released internal Shell documents showing Bakersfield’s refining margin at $23.01 per barrel, or about 55 cents profit per gallon, which topped all of Shell‘s U.S. refineries.

“Only an oil company that wants to short the market and artificially drive up the price of gasoline would demolish a highly profitable refinery rather than sell it,” said Jamie Court, president of FTCR.

Shell spokesman Cameron Smyth denied the charges.

Shell made the decision to close the refinery due to a lack of crude in the San Joaquin Valley,” Smyth said. “Any assertion that the decision was made to restrict supply or drive up prices is absolutely false.”

Shell plans to dismantle the plant after it closes Sept. 30, Smyth added, but the company will entertain “credible offers” from prospective buyers.

“We are absolutely willing to sell the facility,” he said, “but we have received no offers to date.”

The Bakersfield refinery produces about 2 percent of California’s gasoline supply. Shell plans to make up for the lost production with gas from its other refineries, including facilities in Martinez and Wilmington.

Consumer Watchdog
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