Consumer group wants Calif. AG Harris to block $2.5B gas deal
SANTA MONICA, Calif. (Legal Newsline) - Consumer Watchdog urged California Attorney General Kamala Harris on Wednesday to block a $2.5 billion offer by Tesoro to acquire Arco gas stations and BP's refinery in Carson.
Consumer Watchdog sent a letter to Harris on Wednesday warning that the recent California spike in gasoline prices is a result of low gasoline inventories and recent supply disruptions. It said that the proposed purchase will continue to shrink the state's too-small refinery market and create higher prices. The average price for regular gas in California currently stands at $4.67 a gallon, representing a record for the state and the country.
The letter said that the purchase will allow Tesoro and Chevron to own more than half of the state's fuel refining capacity, including the state's three largest refineries. Consumer Watchdog alleges that the purchase will lead to antitrust law violations.
Tesoro estimates that it would save $250 million a year by combining its Wilmington plant with BP's Carson plant. Consumer Watchdog said that this consolidation will allow Tesoro to reduce output and further drive up gasoline prices. It opposes Tesoro's proposed purchase of Arco stations for similar reasons and states that if Arco goes, so goes the lowest priced sellers of gas in California.