Chevron Corporation

05/22/2024 | Press release | Distributed by Public on 05/22/2024 15:33

california regulations could cut supply, raise gasoline prices says chevron exec

1 "As of Tuesday, the average cost of gas in California is nearly $5.40 a gallon, compared to the national average of $3.66, according to data from AAA.The average for a gallon has risen by around 30 cents for California since the start of April" California's gas tax to increase by 2 cents as prices rise (kcra.com)

2 CEC Docket Number 23-OIIP-01, Chevron Comment Letter, December 12, 2023 RE: Nov 28 Max Margin Penalty

3 Cal. Gov. Office, California Remains the World's 5th Largest Economy | California Governor (2024)

4Cal. Energy Commission, California Oil Refinery History (May 22, 2023)

5CA Source: US Energy Information Administration California Operable Capacity updated in 2022. Retrieved April 2023; PADD 3 (Gulf Coast) Source US Energy Information Administration PADD 3 Operable Capacity updated in 2022

6Crack Spread: A "Quick-and-Dirty" Indicator of Refining Profitability (stillwaterassociates.com)

7 US Energy Information Administration (EIA), Accessed April 2024 resource for Los Angeles Reformulated Blendstock for Oxygenate Blending ("RBOB"),: Los Angeles Ultra-Low Sulfur California Air Resources Board ("CARB") Diesel, Gulf Coast Conventional Gasoline Regular, Gulf Coast Ultra-Low Sulfur No. 2 Diesel spot price. Alaska North Slope ("ANS") crude oil price and Maya crude oil price (spot). Source: "Market Indicators" (sourced from third parties such as S&P Platts). Mars: Mars crude oil price (first purchase). Source: EIA

8Inst. for Energy Res., California Policies Are Discouraging Investment in Oil Production and Refining in the State (Feb. 1, 2024),

9Cal. Air Res. Bd., Advance Clean Car II,

10Division of Petroleum Market Oversight (DPMO) Letter to the Governor, Jan 31, 2024

11 CEC Draft Transportation Fuels Assessment, published on April 12, 2024 Page ES-6

12 California Reformulate Blendstock for Oxygenate Blending (CARBOB)

13 Matthew H. Brown et al., Nat'l Conf. of State Leg., Findings on Hawaii Gasoline Prices and Policies (Apr. 2003)

14 Stillwater Assocs., Study of Fuel Prices and Legislative Initiatives for the State of Hawaii (Aug. 5, 2003),

15 April 11, 2024, CEC Workshop on SB X1-2 Maximum Gross Gasoline Refining Margin and Penalty Structure Stillwater Dave Hackett presentation

16 April 11, 2024, CEC Workshop on SB X1-2 Maximum Gross Gasoline Refining Margin and Penalty Structure DPMO Chief Economist Dr. Moreno presentation

17California Oil Refinery Cost Disclosure Act Monthly Report

18April 11, 2024, CEC Workshop on SB X1-2 Maximum Gross Gasoline Refining Margin and Penalty Structure Tom O'Connor ICF presentation

19 Cal. Pub. Res. Code § 25355.5(e) (emphasis added)

20CEC Draft Transportation Fuels Assessment, published on April 12, 2024

21 CEC. What Drives California's Gasoline Prices? Published September 2022

22 CEC Definition of Environmental Fees, Published March 2023. Petroleum Watch (ca.gov) Accessed April 2024

23US Davis and CARB assume price allowance will continue to increase. CARB Joint Cap-and-Trade Workshop Nov 16 2023 pg. 34

24 CARB's Standardized Regulatory Impact Assessment (SRIA) for 2024 Cap-and-Trade (C&T) amendments does not specify the expected cost increase for fuel consumers. However, the 2018 amendments' SRIA estimated that for every $10.00 increase in C&T Price Allowance, gasoline prices would rise by approximately $0.09 per gallon. CARB Cap-and-Trade 2018 Amendments SRIA (ca.gov) Published Sept 2018, Accessed April 2024

25 CARB Low Carbon Fuel Standard 2023 Amendments SRIA, Published September 2023, Access April 2024

26 CEC Estimated Gasoline Price Breakdown and Margins Data last updated April 2024. Retrieved April 15, 2024

27 Assume C&T price allowance doesn't change significantly over next two years

28 Assume Table 50 proposed scenario of $60 from CARB Cap and Trade 2024 Amendments SRIA, Published April 2024, Accessed April 2024

29 Assume near price ceiling $110.00 by 2031 a scenario model by UC Davis for CARB Modeling by UC Davis, presented to CARB and Quebec MELCCFP November 16, 2023 pg. 34, Accessed April 2024 CARB Cap-and-Trade 2024 Amendments SRIA, Published March 2024, Figure 4

30 CARB's Advanced Clean Cars II, which would implement a ban on new gasoline cars, requires a waiver from the United States Environmental Protection Agency (EPA) under the Clean Air Act. CARB's request for this waiver remains pending with the EPA.

31 Western States Petroleum Association (WSPA) Comments on Advanced Clean Fleets (ACF) Regulation 15-Day Rulemaking Package April 7, 2023 and WSPA Comments on Advanced Clean Cars II Regulation Initial Statement of Reasons (ISOR) Documents May 31, 2022