How much money does oil refinery make each year

Above, the Tesoro petroleum refinery in Carson. California refineries reaped an average of But this year, the average ballooned to With oil prices falling, refinery costs stable and gasoline prices soaring in California, refineries are experiencing a boom in profits.

Absolutely," said Gordon Schremp, a senior fuels specialist at the California Energy Commission.

And yeah, consumers are, unfortunately, having to pay significantly more. The commission's gross profit statistics for refineries, called "refiner margin," represent a mixture of costs and profits at the state's 11 fuel-producing plants.

Because refiners don't reveal their costs or earnings in the state, the energy commission approximates local profits by subtracting the cost of oil as well as taxes, distribution and marketing from the retail price of gasoline. The refiner margin doesn't represent a net income figure reaped by the refiners, but it indicates the rise and fall of those firms' profits.

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Jamie Court, president of Consumer Watchdog, called on lawmakers and Gov. Jerry Brown to "deter this type of gouging by establishing a windfall profits tax and forcing refiners to open their books and justify their inventories, refinery outages and profits. But Tupper Hull, a spokesman for the Western States Petroleum Assn.

how much money does oil refinery make each year

Hull said the market is responding to the basic laws of supply and demand after the refinery troubles and a drop in gasoline inventories. He said that might mean that prices rise for a period of time because of the decline in refinery capacity from plants that aren't producing gasoline and from a shortage in inventories, but it will balance out in the long run. Consumers, Hull said, would be harmed if oil refiners operated with complete transparency because such openness would enable the kind of industry collusion that companies are accused of now.

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how much money does oil refinery make each year

This year's record refiner margin through the end of June topped the previous record set in the first six months of The refineries' average take during that period was Then, as now, oil companies attributed at least part of the price increase to problems at California refineries.

This time, the primary catalyst was a February explosion that crippled Exxon Mobil's Torrance plant, which has historically produced about a fifth of Southern California's gasoline. It might not return to service before Christmas.

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That means Exxon Mobil isn't benefiting from the high gas prices, though others such as Valero and Shell are raking in significant amounts of money. California prices are almost always higher than national prices. The AAA notes that prices are driven up by higher-than-average taxes and fees, state requirements to produce special low-pollution blends and the relatively small number of refineries in the state.

Part of that cost includes an estimated 10 to 12 cents a gallon for the state's cap-and-trade market that was instituted to help combat global warming.

Norm Woods, 45, of Los Angeles said that although the gas prices haven't hit him hard, the additional cost has forced him to leave his more gas-guzzling Hummer at home in favor of his Acura.

It's been more difficult for year-old Paul Valles.

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Valles, filling up his Jeep Commander on Tuesday afternoon at a 76 station near L. The Valencia resident commutes to Los Angeles a few times a week for his medical supply job and said he's shopping for a hybrid to replace his car, which gets about 10 miles per gallon.

how much money does oil refinery make each year

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