Oil falls but gas prices increase in San Diego
San Diego, which traditionally has some of the higher gas prices in the country, is experiencing a new increase in gas prices. Strangely enough, this increase is occurring as the price of oil continues to fall.
With oil hovering around $35 per barrel this week, the average price for a gallon of gas in San Diego has risen to $1.81. This is up ten cents from a week and a half ago. This increase is being attributed to a decrease in supply from California refiners. The refiners, who have complained about losing money on sales of gasoline, have cutback their production by 6.4% in the last week. This has created a situation where refiners are apparently back in the black for their wholesale gasoline sales.
While refiners, of course, have the right to make a profit, the ease with which they are able to manipulate gas prices by cutting back on production is just another warning sign.
Whether the cut in production by California refiners is an illegal price manipulation or a natural occurrence, the ease with which refiner activity can effect prices further underlines the need to just get off of oil.
It doesn’t matter if it is an explicit cartel like OPEC or a loose group of consolidated domestic refiners, the supply chain for gasoline is too volatile and controlled by too few organizations to ever be reliable.
- Similar Posts:
- While oil prices boom, refinery profits contract
- The price of oil vs. price of gasoline inversion explained
- California’s Mini-Price Spike for Gasoline Continues
Comments
Please contribute to the discussion by leaving a comment below. No need to agree with the post or other commenters, but please be constructive and respectful.
