Watchdog Group Pans California Refineries For Price Gouging

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Group tells Senate committee this latest price increase was orchestrated by refineries

SACRAMENTO, Calif. – A consumer watchdog report says California oil refineries have about half as much gasoline on hand compared to the rest of the country. Tuesday a consumer advocate told a Senate committee the situation has lead to a spike in gasoline prices for Californians.

The report conducted by Consumer Watchdog says oil refineries are gouging Californians by keeping the state running on empty. 

They say when refineries go down, gasoline prices go up.  And California is the worst case scenario.

The report further explains how Californians paid $47 billion extra, or $13 million per day more for gasoline compared to the rest of America over the last ten years.

Jamie Court, President of Consumer Watchdog says, "There is about an .84 difference in gas prices with the rest of America right now. Crude oil costs the same in California. This is really oil companies making big profits. The Senate committee agrees with our report that all of this extra money, the .84 per gallon is going right back into the pockets of the oil refinery and this committee is going to be discussing what can we do to change that."

Court says his group and other advocates plan to urge the governor and the Legislature to require oil refiners to keep another week of gasoline inventory on hand to avoid gasoline price spikes in the third largest gasoline consuming economy in the world.

Court was asked what he'd do to change the status quo, " First of all, we don't have enough real time information. We did a report showing that over 10 years we've had about  10.7 days worth of supply on hand in California compared to 18 in America. So we have always been behind in supplies. So we need real time data about when refineries go down and why. And we need information as to what days the supply is on hand, that's transparency."

Court says there's no way gas prices should have spiked in California in February, "Crude prices are at all time low and we have gas prices going up a dollar in a month in February. That cost Californians $550 million, a half billion dollars at the pump. So something is sour here."  Court went on to say, "What the report said is the reason we've seen these price increases is because we have low inventories in California for gasoline and we had two refineries break and when you have the system running on empty, then you're going to see prices shoot up like a rocket.  And they're gonna stay up there and that's where we are now."

A strong Oil lobby in California seems to keep reaching it's hands in consumer's pockets, is there a solution to this?

"I was on the Attorney General's task force and we found that the same problems, low inventories, and a few refineries controlling the market were the problem 15 years ago," says Court.

"I have faith this time that things may be different, even though, the oil companies have the biggest lobby and biggest campaign machine in Sacramento. The reason is, the legislature and the governor are very committed to protecting Cap and Trade and greenhouse gas laws and the oil companies are coming hard on those laws and they are blaming price run-ups at the pump on greenhouse gas laws, and that's just complete fiction."

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