Californians Say Aloha (in the Bye-Bye Sense) to Their Savings -- State Gasoline Price Tops Hawaii
California's Record Pump Price is $3.634, Usual Leader Hawaii Drops to $3.62 -- Group Praises Hawaii Effort to Expose Profits
Santa Monica, CA -- In a reversal of the usual gasoline price pattern, the isolated market of Hawaii now has cheaper gasoline than California, said the Foundation for Taxpayer and Consumer Rights. In addition, Hawaii's Legislature is proposing to require that oil refiners open their books on their costs and profits, a move that FTCR has long advocated in California and nationally.
While Hawaii dropped a little to $3.62 a gallon today for regular, California hit another daily record at $3.634, per AAA. In addition, because of its “hot fuel” law, Hawaii compensates for its high gasoline temperatures by selling a slightly larger gallon at the pump. The total difference is more than a nickel a gallon, said FTCR (see details below).
“When Hawaii’s gasoline price drops below California’s, it’s a signal that prices are separating from reality in the U.S. West,” said Judy Dugan, research director of FTCR and its OilWatchdog project. “Crude oil prices have started dropping and the national average gasoline price eased a fraction of a cent on AAA today, but there’s no signal yet that Western gasoline prices will follow.”
Even in Washington State, which uses plain regular gasoline instead of a clean-air formula, and also has lower gasoline taxes, the price per gallon is a record $3.528, noted FTCR.
Hawaii legislators are at least taking action to control the usual spring runup in gasoline prices and refinery profits, said FTCR. The Hawaii legislation (SB 2630) has passed the state Senate and is being considered in the House, reports the Honolulu TV station KHON (Click here to view print version of story.)
The bill would require nearly every segment of the state’s refining industry to disclose the cost of doing business in Hawaii. Oil and gas companies would be required to file a report every six months on such items as the cost of crude oil, refinery operating expenses, marketing operating expenses, and corporate overhead.
“The oil industry is lobbying furiously against Hawaii’s proposal, but it’s nothing more than a little sunshine on the dark hole of gasoline pricing,” said Dugan. “California lawmakers caved in to oil industry pressure last year and failed last year to pass a much milder version of a disclosure bill. They owe it to California’s stressed-out motorists to do it this year.”
Hawaii’s retail gallon of gasoline is larger than in the rest of the U.S. because of the state’s “hot fuel” law. Hawaii is warm year-round, and so is gasoline sold in the state, averaging over 80 degrees. Gasoline expands and loses energy as it heats up. Hawaii requires a gallon slightly more than 1% larger than the U.S. standard, a hypothetical “60-degree” gallon.
“In reality, Hawaii’s gasoline is more than a nickel cheaper than California’s, because drivers are already getting four cents extra worth of gasoline in each gallon,” said Dugan. “No wonder oil companies and marketers are so opposed to giving motorists in California and other warm states a fair measure of fuel by compensating for fuel temperature on retail sales.”
See OilWatchdog.org for more information on hot fuel and efforts to stop the ripoff.
FTCR and OilWatchdog have also called for:
- Swift action to close the Enron Loophole in commodity trading regulation. A regulatory measure in the federal farm bill (S.2058 by Sens. Dianne Feinstein and Carl Levin) would help stop speculative oil pricing. (Click here to see more on Enron Loophole and farm bill amendment. )
- Senate approval of an alternative fuels bill funded by withdrawing $1.8 billion a year in unjustified taxpayer subsidies to oil companies. This measure, passed by the House, faces an uncertain future in the Senate. A similar House measure was removed from the federal energy bill by the Senate last year under pressure from the oil lobby. (Click here to see text of HR 5351.
- Statements of intent by the presidential candidates. Today’s presidential candidates must do more than make disapproving noises about today’s energy crisis, said OilWatchdog. They must let voters know how they plan to keep the oil lobby out of the White House and stop this from happening again.
Consumer Watchdog (formerly The Foundation for Taxpayer and Consumer Rights) is a non-profit, non-partisan organization.
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