The West Coast is particularly vulnerable to spikes in gasoline prices because it’s not well-connected to the refineries along the Gulf Coast, where most of the country’s refining capacity is located, analysts say.

The Chevron refinery is particularly big and important to the West Coast market, said Tom Kloza, chief oil analyst at Oil Price Information Service.

It produces about 150,000 barrels of gasoline a day — 16 percent of the region’s daily gasoline consumption of 963,000 barrels, he said.

California’s average price Tuesday for a gallon of regular gasoline was $3.86. But with inventories in the region already low compared with the rest of the country, pump prices along the West Coast will soon average more than $4 a gallon, Kloza said.

Chevron spokesman Lloyd Avram said he did not have an update on when the refinery could be restarted and declined to comment on what kind of impact the shutdown might have on the gasoline market.

“Spot prices have already increased by as much as 30 cents per gallon in some West Coast markets and that’s before the refinery damage has been fully assessed,” said analyst Patrick DeHaan of the website GasBuddy.com.

The fire began around 6:15 p.m. Monday in the refinery’s No. 4 Crude Unit, about two hours after a vapor leak of hydrocarbons similar to diesel, said Heather Kulp, a Chevron spokeswoman.

“At approximately 6:30 p.m., the volume increased and personnel evacuated the area,” she said at a news conference. “The hydrocarbon vapor then ignited and a fire occurred.”

Kulp said there were no explosions, and staff at the refinery initiated an emergency response immediately after the fire started. The cause is under investigation.

The black smoke and flames could be seen miles away from the refinery, which has been the target of complaints and lawsuits by people who live near it in Richmond, a mostly low-income community with five major oil refineries.

Mayor Gayle McLaughlin said the fire was unacceptable.

“We live with the day-to-day risk of this type of manufacturing and refining that has an impact on our community with pollutants being released, but with the accident that happened yesterday, that doesn’t mean it’s acceptable, because it’s not,” McLaughlin said in a KCBS radio interview.

Emotions ran high during a Tuesday night community meeting in Richmond, where hundreds of people booed and shouted as a panel of Chevron and local officials tried to address the crowd.

“I can assure you I have the utmost respect for this community,” Nigel Hearne, the general manager of the refinery, said as the heckling intensified.

Article source: http://www.washingtonpost.com/national/energy-environment/analysts-calif-refinery-fire-will-push-gas-prices-past-4-a-gallon-on-west-coast/2012/06/14/gJQA6DDueX_story.html

What does the consumer price index (CPI) have to tell us about the future of the housing market?

Apparently a lot.

Let me first explain a few things for those of you housing types who don’t follow this monthly number. The CPI is the most common way to measure inflation. There’s the big number and then what’s called the “core” number, which is the big number minus food and energy costs (gas prices obviously skewing things a lot these days). The big number was pushed down thanks to a drop in gasoline prices, but the core number was higher than expected, thanks to housing.

One component of the CPI is the “Owners Equivalent Rent,” (OER) measures the amount of money it costs to live somewhere, anywhere, be it a rental apartment or your own home.

“The key factor in the higher than expected core rate was a .2 percent rise in Owners Equivalent Rent, the biggest gain since March ’09,” writes Peter Boockvar of Miller Tabak. “This figure is important because it makes up 25 percent of CPI and 40 percent of the core. Apartment landlords are gaining pricing power as vacancies fall as the homeownership continues its decline. This is a secular trend and will result in a further lift in core inflation going forward.”

Page 1 of 3 | Next Page
Show Entire Article

Obama, Republicans Trade Demands for Debt Plan

CEO of WSJ Parent Resigns Amid News Corp Scandal

Recession’s Legacy: Twice as Many Americans Saving

One Democrat’s Advice: Raising Taxes Doesn’t Add Revenue

SP Threatens Broad Downgrade of Finance Companies

More Top Stories

Article source: http://www.cnbc.com/id/43769306?__source=RSS*blog*&par=RSS

Sales of existing homes fell 3.8 percent in May, not as deep a drop as some had forecast, to a seasonally adjusted annual rate of 4.81 million units.

April’s figure was revised down to 5 million.

Potential homebuyers continue to be held back by tough credit standards and poor confidence. Sales activity was 15.3 percent below the pace set in May of 2010, when buyers were rushing to take advantage of the home buyer tax credit.

“Spiking gasoline prices along with widespread severe weather hurt house shopping in April, leading to soft figures for actual closings in May,” said Lawrence Yun, chief economist for the National Association of Realtors.

The national median existing-home price for all housing types was $166,500 in May, down 4.6 percent from May 2010. Home prices continue to be pressured by the large supply of distressed properties, which typically sold at a discount of about 20 percent in May. Foreclosures and short sales, where the home is sold for less than the value of the mortgage, accounted for 31 percent of sales in May, down from 37 percent in April.

Page 1 of 3 | Next Page
Show Entire Article

Surviving Greek Government to Approve New Austerity

Bernanke to Walk a Fine Line on Inflation, Growth

Caution About Greece Returns to the Markets

FedEx Profit Rises, Sees Robust 2012

Obama To Set Course for Drawing Down Afghan War

More Top Stories

Article source: http://www.cnbc.com/id/43478610?__source=RSS*blog*&par=RSS