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For Immediate Release: June 7, 2006
Media Contact: Rob Schlichting - 916-654-4989

Gasoline, diesel production high as refiners shift to new fuel


Sacramento - For the second week in a row, production of gasoline for use in California averaged more than a million barrels a day, even as refiners switched to a cleaner type of diesel fuel.

According to the Weekly Fuels Watch Report issued today by the California Energy Commission, California refineries produced an average of 1,019,857 barrels a day of reformulated gasoline. That figure, for the week ending June 2, 2006, fell 1.8 percent below the previous week's production, but was 5.0 percent higher than at this time one year ago. Inventories of California gasoline dropped 5.5 percent from the previous week and were 17.6 percent below last year's unusually high figures.

As of June 1, California refiners must make "Ultra Low Sulfur Diesel" (ULSD) to comply with new regulations that require all diesel fuel sold in the state to contain no more than 15 parts per million of sulfur. Most California refiners switched to ULSD well in advance of the June 1 transition date, and last week's CARB diesel production increased 15.6 percent over the week before. CARB diesel output was 17.3 percent better than at this time last year; inventories were 6.5 percent above the previous week's and 17.1 percent more abundant than at this time in 2005.

As refiners prepared to switch to Ultra Low Sulfur Diesel, the Energy Commission and the Air Resources Board conducted a joint survey of the industry to determine the likelihood of supply or logistics problems. The study found that no problems were expected in California as all refiners began meeting the new standard. A copy of the ULSD Fuel Outlook Staff Paper will be released by the end of the next week.

Today's entire Weekly Fuels Watch Report can be seen on the Energy Commission's Web site at

www.energy.ca.gov/database/fore

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