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To: Elroy Jetson who wrote (5608)	5/5/2004 10:41:13 AM
From: Knighty Tin	Read Replies (10) \| Respond to of 116555

Elroy, We all know that it's just a handout to the oil companies to rip off the state's citizens once again. The power shortage (which is also back, btw, and not being reported upon) was the first line your pocket scam. Now that the Enron deal has cooled off, they can strike again.

To: Elroy Jetson who wrote (5608)	5/5/2004 1:17:40 PM
From: GraceZ	Respond to of 116555

Refineries running at or near 100% don't allow for even small problems with distribution: eia.doe.gov Why West Coast Gasoline Is Often the Most Expensive in the Nation Gasoline prices on the West Coast are usually the highest in the nation, largely due to several factors. First, the West Coast is geographically isolated, with petroleum markets typically self-sufficient. That is, usually gasoline demand is almost entirely supplied from West Coast refineries. When supplies get tight, it can take weeks for added supply to arrive from outside the region. To satisfy consumption, West Coast refineries operate at relatively high levels, especially during the peak summer season. When refinery or other distribution problem occur, West Coast markets tighten very quickly, causing prices to rise quickly. Since the entire West Coast market is interconnected, price pressures in one area often affect the whole region. The second reason West Coast prices are typically higher is that California, which comprises the dominant share of the West Coast market, uses a unique type of reformulated gasoline. California RFG must conform to more stringent requirements than Federally-mandated RFG, making it more expensive to produce. With no short-term "complying" supply readily available, significant shifts in markets conditions can cause large price changes. Still another, but often unrecognized factor, is that not only does California consume more gasoline than any other state, nearly 39 million gallons daily in 1999, but in recent years, demand has grown at a pace roughly 2 to 4 times its production capacity growth. These factors combine to put pressure on refineries to produce at near maximum rates. With the balance between supply and demand so fragile, any problems with infrastructure, whether refining or distribution, cause prices to increase substantially. An April 2000 General Accounting Office (GAO) report noted that while California had not experienced more price "spikes" than other regions, the increases experienced were larger. This finding is consistent with a system operating with a finely tuned balance between supply and demand, with little or no room for error. Although California strongly influences gasoline market conditions for the entire West Coast, it can impact other regions of the country as well - especially this year. A problem in California can result in extra supplies of gasoline being purchased on the Gulf Coast for delivery to the West Coast. These marginal barrels add price pressure to the Gulf Coast, which supplies not only the Gulf region, but also the East Coast and the Midwest. With the gasoline balance very tight in these other regions, especially the Midwest, additional product demand from California can increase prices in areas East of the Rocky Mountains. In closing, I would like to focus briefly on the rest of the country.