In this edition of the newsletter we let you know about two studies authored by Stillwater that are making some waves. Our "Response to McCullough Research Report," written for WSPA, contradicts a study that blames the 2012 California Gasoline Price Spike on market manipulation. The second study co-authored with the University of Calgary School of Public Policy, argues for directing Canadian Crude Oil to Pacific Rim refiners.
In other news, Dave Hackett will be speaking about the LCFS at this year's AFPM Annual Meeting. Finally, Stillwater has a new focus under our Policy business line - State Energy Assurance Plans.
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| Stillwater Study Debunks Allegations of West Coast Gasoline Price Manipulation |
When gasoline prices in California shot up to record levels last fall, Stillwater was paying close attention to the situation. We monitor crude oil and retail gasoline prices daily and wrote extensively about this price spike on our blog. Our take on the price spike at the time was that low inventories caused by a confluence of unplanned refinery outages and planned refinery maintenance lead to a supply-squeeze that sent wholesale prices soaring. But a report issued by McCullough Research, an electricity consultant from Portland, Oregon, came to a different conclusion. The McCullough Report, entitled "May and October 2012 Gasoline Price Spikes on the West Coast," alleged that the price volatility was caused by market manipulation.
Last Friday, WSPA released a report written by Stillwater, that directly contradicts the assertions in the McCullough Report. Our analysis found that the McCullough Report shows a lack of familiarity with the oil industry and the west coast gasoline market.
Contact David Hackett to find out more about fluctuating Gasoline Prices.
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Pacific Rim Refiners Won't Wait Forever for Canadian Crude Oil
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Pacific Rim refineries have the capacity for Canadian heavy crude oil, but the window for opportunity is narrow. Unless crude oil producers in Alberta can find a way to get their product to refiners in the Pacific Rim consistently, those refiners will start looking for heavy crude elsewhere. On February 7th, the University of Calgary School of Public Policy released a paper co-authored by Stillwater Associates entitled Pacific Basin Heavy Oil Refining Capacity, in which the case is made for redirecting Canadian crude oil out of the Mid-Continent bubble and sending it to refineries in the Pacific Rim, including California, China and Korea. Read more...
Contact Stillwater Associates to find out more about getting Canadian Crude Oil out of the Mid-Continent Bubble.
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Stillwater Associates is a transportation energy consulting company. We help our clients understand how fuels get from the source to the service station. If your company is in need of expert advice, please let us know.
Sincerely,
David J. Hackett, President
Stillwater Associates LLC |
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| Dave Hackett to Speak at AFPM in March |
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Dave will be giving a talk at this year's AFPM annual meeting on California's Low Carbon Fuel Standard. With the implementation of California's LCFS underway, the presentation will explore these questions:
- Will the regulation be adjust to reflect market conditions?
- How hard do regulators push for new technology development?
- How do we know this innovation is occurring fast enough to meet the schedule set forth by the regulation?
The AFPM Annual meeting is scheduled for March 17 - 19 at the Marriott Rivercenter in San Antonio, TX. Hope to see you there!
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New Focus under our Policy Business Line: Energy Assurance Plans
| Stillwater Associates has researched state Energy Assurance Plans (EAPs) and has found that many of them have woefully inadequate transportation energy sections. The transportation fuels section should at minimum ensure that critical service providers have the necessary fuels to maintain public order and safety. These services include health care, police and fire, sanitation, public transportation, aviation ground support to name a few.
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Visit our EAP page to find out how Stillwater can help your state develop their strategy. |
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