California's senior senator Sunday charged that California's record gasoline prices may be the "results of an illegal short squeeze" engineered by the handful of companies that refine gas here.
In a letter to the Federal Trade Commission, Sen. Dianne Feinstein, cited news reports that said Tesoro Corporation—whose refinery near San Pedro went down for maintenance—was taken advantage of by other gas suppliers "either through collusion or the use of market power."
"Publicly-available data appears to confirm that market fundamnetals are not to blame for rising gas prices in California," the California democrat wrote in a letter to FTC chairman Jon Leibowitz.
Feinstein also called on the FTC to monitor energy price and production data gathered by other government agencies, to watch for "fraud, manipulation or other malicious trading practices."
She also urged the FTC to establish a permanent gas and oil oversight market committee, similar to the Federal Energy Regulatory Commission's oversight of the natural gas and electricity markets.
Feinstein said "California consumers are all-too-familiar with energy price spikes which cannot be explained by market fundamentals, and which turn out years later to have been the result of malicious and manipulative trading activity.
She reminded the FTC of past frauds, like the 2000-2001 electrical crisis, which turned out to have been caused by market manipulation by Enron and other traders. That fraud cost the state an estimated $40 billion, caused rolling blackouts, and is cited by some historians as having cost Gov. Gray Davis his political career.
-City News Service
" A bankrupt Longmont-based company that received $68 million in stimulus money is under investigation by the Weld County district attorney’s office. … 7NEWS obtained internal documents from 2012 that show orders for tens of thousands of replacement solar panels. The orders cite different reasons for the replacements including, “low performance,” “under performance” and “catastrophic failures.” The orders are for replacements requested after the Department of Energy stopped stimulus money payments to Abound. “These are solar panels we are now seeing reports that said they worked as long as you didn’t put them in the sun,” said Rep. Cory Gardner, R-Colo. “Now the question is did the (Department of Energy) —did they know something that the rest of should have known? Did Abound not tell the DOE something? These are questions that need to be answered.”" http://www.thedenverchannel.com/news/local-news/abound-solar-under-investigation-by-weld-county-district-attorney-received-68-million-stimulus
But I agree with the need for getting more gasoline into the state from the outside. There's probably no prohibition on that, they just have to make the California blends, and it may not be worth their while for them to do it because there is adequate capacity here most of the time. Also, let's not forget that making these special blends costs 10 or 20 cents more a gallon (I don't have an exact figure). And the state takes 50 or 60 cents a gallon in taxes (and they charge sales tax on top of the excise taxes!). Compare all that to the few cents the refiner makes. Who's the real villain in raising gasoline prices?
The California blends may just be obsolete as moder pumps have new vapor capture technologies, modern cars also burn gas very clean with no vapor escape from the tanks ... I thnink maybe we should look at that.
If the supply of gasoline decreased, as we are told it did, and there no shortages, meaning no people who want to buy but can't find a seller at any price, then that's proof that the price increases curbed demand! Okay, I'll backtrack a bit on that--maybe just the news of the smaller supplies caused some drivers to postpone vacations or other trips. But I'll bet that effect is not large enough to account for the reduction in demand.
Some good news is that if the refineries are brought back online faster than anticipated, there will something of glut of gasoline and prices will be pushed lower for a while. For those who have to keep driving through it all, it may come near balancing out.
My statement of PROVING IT is fair. We hear lots from political hacks, it want Feinstein, Brown, YOU, et al put up or shut up. If a crime has been committed, lock up the criminals.
I agree. Never happen.
Sen. Dianne Feinstein keeps getting reelected because the majority of voters in California support her and appreciate what she's done over the years. The way the Senate works, she does have seniority, which gives our state an advantage in that she will chair more committees, etc. I'm glad she's challenging the oil company executives to "play fair," not to further manipulate gas prices through pretense and fraud.
Outside food okay at Petco? Now if I only liked baseball. Let's talk about the economics of using taxpayer money to build that stadium, and many others...Nah, some other time.
TAXPAYER MONEY SHOULD NEVER be used to build a stadium ... It shouldn't even be legal ... the MOST the city should do is assist in assembling the land - not eminent domain and not buying it - just coordinate between the owners ..
In confirmation of what I said, Bloomberg reports (http://www.bloomberg.com/news/2012-10-08/california-facing-5-gasoline-stirs-brown-to-relax-rules.html): California is dependent on its own refineries for gasoline because the state is mostly cut off from oil-products pipelines spanning the rest of the country. Refiners outside California are generally not equipped to supply the cleaner-burning gasoline required in the state. and “This is probably going to continue to recur because California has just enough refining capacity to supply its demand, but only if everything is running well,” said John R. Auers, senior vice president at Dallas-based Turner Mason & Co., which advises energy companies. The state’s refining industry “operates on a knife’s edge,” he said.
Maybe you need to sneak some Pemex north of the border to complete your foray into econ.
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