California Marketers Face Gasoline Shortages

Fuel marketers in California are facing gasoline supply shortages that have driven wholesale spot gas prices to record highs. Gasoline stations in the Los Angeles area are shutting off pumps as the state’s oil refiners started rationing supplies and spot prices surged to a record. Late last week, Valero stopped selling gasoline on the spot market in Southern California and is allocating supply to its customers. ExxonMobil is also allocating supply to west coast terminal customers.

Problems at California refineries have slashed supplies across the state, cutting gasoline production and raising spot prices by as much as 73 cents, levels not seen since 2007. The California Independent Oil Marketers Association (CIOMA) asked the state last week to expedite a waiver that would allow refiners to produce and sell winter-grade fuel. California’s summer-blend fuel requirements are in effect in southern California until Oct. 31.

CIOMA spokesman Jay McKeeman said that while the current situation is unusual under the state's complex and unique fuel regulations, the state's pending implementation of the Low Carbon Fuel Standard (LCFS) "could make situations like this the norm, rather than the exception." California is the first state in the nation to implement the LCFS, requiring a ten percent reduction in the carbon intensity of transportation fuels by 2020.


This article originally ran in NATSO News Weekly (NNW), NATSO's member only weekly electronic newsletter. NNW is packed with the latest updates on government and business issues affecting the truckstop and travel plaza industry.

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