Santa Monica, CA—Consumer Watchdog today sent a letter to California Attorney General Kamala Harris and Robert Weisenmiller, Chair of the California Energy Commission, asking that they investigate Tesoro’s decision to shut down its Martinez refinery indefinitely as steelworkers mount a national strike.
“This is an inopportune time for Tesoro to be shutting down a refinery,” wrote Consumer Advocate Liza Tucker. “We ask that you investigate immediately the reasons for this unnecessary decision in order to rule out a concerted refinery effort to drive up the price of gasoline in California.”
For the letter, see: http://www.consumerwatchdog.org/resources/steelworkersstriketesoroltr.pdf
Tucker wrote that Tesoro’s decision to shut down the Martinez plant completely, rather than to continue to partially operate, meant that Tesoro was taking offline 8 percent of the state’s crude oil refining capacity. “We understand that refineries must get ready to produce California’s special summer blend of gasoline,” she wrote.” But it makes little sense to shut the plant down entirely right now, in the midst of a national strike the likes of which we haven’t seen in 30 years—unless it is a measure being taken by Tesoro to intentionally affect the price of gasoline.”
The spot price of California gasoline in Los Angeles had already jumped up nearly 20 cents per gallon the week ending February 2 on the heels of a production drop of one third since mid-December, the letter said. “Given the sharp drop in production that will be compounded by the absence of Tesoro’s Martinez production, prices are bound to keep rising while stockpiles begin to shrink.” Tucker said that refineries have record of trying to restrict supply to drive up prices, helped along by California’s habit of keeping only 10 to 12 days supply of gasoline on hand—less than half of the 24-day historical average for other states.
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