Drivers' Patience Hits Empty as Gas Prices Soar

Don't blame us.

That has become the catch phrase among oil companies, gasoline wholesalers and service-station owners as California gasoline prices have jumped about 30 cents a gallon in recent weeks.

As regular unleaded topped $1.50 a gallon at many Southland stations Friday, drivers griped and some even threatened a one-day gasoline boycott.

"It's costing us 30% more to truck our merchandise than it did a few days ago," said James Rice, who runs the regional office for sporting goods maker Wilson Inc. in San Clemente. "We're really stuck."

Gasoline makers and sellers deny that they are milking the surge for extra profits.

"I'm making 8 cents a gallon, same as usual, just enough to cover my expenses and leave a little to take home," said Mary Lou Mendez, owner of a Costa Mesa Chevron station.

"It's clearly not going to us," said Don MacPherson, president of the California Independent Petroleum Assn., which represents oil companies. "We didn't have anything to do with this and we don't benefit from it."

But industry analysts said savvy operators all along the petroleum distribution chain are profiting from the recent upswing, principally refiners whose plants are pumping at full capacity.

"To say we're gleefully profiting would be wrong, but any refiner who is operating efficiently in today's market is probably pleased with its share of business," said Mobil Corp. spokeswoman Carolin Keith.

Mobil's Torrance refinery, which produces 130,000 barrels of fuel a day, was functioning smoothly until Friday, when a leak caused a short-term closure that will not affect production, Keith said.

Among the other beneficiaries are wholesalers and retailers who saw the trend coming, stocked up on gasoline and waited for prices to rise.

About 30 maverick tanker owners also guessed right, and sent ships normally routed to Asia and the East Coast to California.

"This is like getting a winning lottery ticket," said Bruce Schwartz, a director in Standard & Poor's corporate ratings division. "It's infrequent and short-lived, but they will make money."

The California Energy Commission says the price spike should subside soon because the state's gasoline inventories, while 4% lower than a week ago, are more than 14% higher than they were this week in 1998.

The perception of a short-term gasoline shortage may have outweighed the reality, spurring wholesalers to buy larger-than-usual supplies, sending prices skyward, said commission spokesman Rob Schlichting.