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Los Angeles drivers get surging petrol as Christmas present
[CALGARY] While most of the country gets a Christmas present of petrol near US$2 a gallon, Los Angeles drivers are getting coal in their stockings.
Pump prices in the US's second-biggest city have gained 17 cents in the past week to US$2.92 a gallon, the highest of any metro area in the Continental US, according to AAA. In the wholesale market, California-blend gasoline surged to a four-month high versus New York futures as refinery breakdowns reduced supply.
"Gas prices have been higher than the rest of the country for most of the year and its painful to see that trend continue during the holiday season," Michael Green, AAA spokesman, said in a phone interview. "No one wants gas prices to be the Grinch that stole Christmas."
The jump in prices comes as a record 100.5 million people are expected to travel this holiday. Driving demand amid an improved labour market, rising incomes and national average pump prices that fell below US$2 a gallon for the first time since 2009 last week, according to AAA.
While most of the country benefits from oil's plunge, California drivers haven't been as lucky. A gasoline-producing unit at Tesoro Corp's Wilmington refinery was said to be shutting down yesterday after a compressor broke. A similar gasoline unit at the neighboring Tesoro's Carson refinery was already said to be down and Exxon Mobil Corp's unit at Torrance has been mostly shut since a February explosion.
CARBOB in Los Angeles jumped 33.5 cents to 83 cents a gallon more than futures, the highest since Aug 12, data compiled by Bloomberg show.
The situation isn't quite as grim in the Bay Area area where refineries have been operating at more normal levels. California-blend gasoline's premium to futures in San Francisco was unchanged at 35 cents a gallon today, leaving the spread between Los Angeles and San Francisco wholesale prices at 48 cents a gallon, the widest since July, data compiled by Bloomberg show.
California is the state with the highest pump prices in the country, Green said.