(Bloomberg) — Chevron Corp.’s plan to move major maintenance at its San Francisco Bay-area refinery to June from April because of an ongoing labor strike may further exacerbate already-high California fuel prices.
Retail gasoline prices in California led the national rally to a record high in February, and have clung close to that level while prices in the rest of the U.S. have cooled. Gasoline averaged $5.763 a gallon in California on Monday, down by 0.7% from month-ago levels, according to data from auto club AAA. By contrast, the national average has fallen by 5% over the past month.
The summer driving season kicks off with the Memorial Day holiday at the end of May. The turnaround at Chevron’s Richmond refinery will start in mid-June and last about 45 days, eating up a chunk of the prime time to sell gasoline.
The timing of the turnaround, which includes the sole crude unit at the 245,300 barrel-a-day refinery, highlights California’s vulnerability to any hiccups in gasoline production. Chevron may also have to import feedstocks for the refinery that could be used to make fuel while its crude unit is down, never an easy feat for the isolated California market, said Robert Campbell, head of oil products research at London-based consultancy Energy Aspects.
Chevron doesn’t comment on day-to-day operations, spokesman Tyler Kruzich said.
