Chevron doubles 3rd Q refining profit to $2.5 billion; New CA Transparency Law Will Reveal Extent of Hidden Windfall Profits, Consumer Watchdog Says

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LOS ANGELES, October 28, 2022 /PRNewswire/ — Chevron reported refining earnings of $2.5 billion in the third quarter, almost doubling their transport compared to the same quarter of the previous year. Half of that amount came from U.S. refining operations alone, according to the company’s financial statements. But consumers will only know how much of Chevron’s profits come specifically from California when a new state refiner transparency law takes effect, Consumer Watchdog said today.

Chevron is the only California five major oil refiners that do not report quarterly profits per gallon of refining on the West Coast.

California new Refiner Transparency Act will pull back the curtain on Chevron’s huge hidden profits,” said Liza Tucker, Energy and Environment Director of Consumer Watchdog. “We don’t yet know how much Chevron has made per gallon of gasoline, which is critical in determining how much they will need to California back for their windfall profits if the legislature enacts such a reform. But we’ll find out once the new Oil Refiner Cost Transparency Act takes effect in January. »

Transparency law, SB 1322, requires monthly reporting from refiners California-specific benefits per gallon. This will give the state a way to monitor price gouging in real time and, if a price gouging rebate is passed, return excess profits to drivers in the form of a rebate.

In Chevron 3rd quarterly presentation to investors, the company’s chief financial officer Pierre Breber noted that market demand for oil and gas was unprecedented. “We’re in a market that we haven’t seen in my career in terms of supply and demand tension,” he said. Covid has caused some refineries to close around the world and others to switch to making renewable diesel, Breber said. Some refineries of California are actually offline and converted to make this fuel.

“Overall, Chevron is making more money by making less gasoline,” Tucker said. Its downstream business in the United States recorded profits of $1.29 billion in the third quarter, driven by higher margins on refined products, up slightly more $1 billion in the period of last year. But Chevron slashed its crude oil inflows by 13% in the third quarter from a year ago, mostly due to “planned shutdowns” at refineries.

Consumer Watchdog estimates that the amount of windfall profits to be returned to consumers by refiners reported so far this year is now almost $1.5 billion, excluding Chevron’s exceptional earnings, which will not be disclosed until the end of the year. See the calculation. The formula used to calculate windfall profits is each dollar of profit made above 50 cents per gallon, which has only been achieved by a refiner three times in the past 21 years – each time by Chevron. View the historical earnings report here.

“Chevron is the largest refiner in the state and is also the most opaque about providing earnings-per-gallon data,” Tucker said. “That’s why the Transparency Act was a critical first step and why it’s so important to have the legislative session in December that Governor Newsom called for capping and allowing rebates,” Tucker said. .

Chevron reported third-quarter net profit of $11.2 billionalmost doubling the $6.1 billion in the same quarter last year. Operating profits derived specifically from oil and gas soared 81% in this quarter compared to the same quarter last year to reach $9.3 billion.

Refiners Valero and PBF Energy released quarterly results earlier this week that provided a date for estimating refining profits per gallon. PBF Energy strikes 78 cents per gallon – approximately 50% more profit in California than anywhere else in the country where it operates.

Profits from the Valero West region that come solely from California refineries overcome 60 cents per gallon.

SOURCE Consumer Watchdog

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