California is a Seller's Market.

The lead in today's San Francisco Chronicle article about gasoline prices speaks volumes:

"California's gasoline prices fell 17 cents during the past month to hit $3.32 per gallon, as oil companies imported fuel to make up for lagging production from the state's refineries. "

Just to get the California price down to $3.32-- which is 28 cents higher than the national average--- we had to import finished product into the state.

Yesterday I noted that the Spaniards are investing $800 million in a plan to export electricity from Mexico to California to meet the demand for green energy. You know all about the Australians' failed attempt to export LNG to meet demand in California. Now companies are refining California-grade gasoline out of state for importation into our state.

California is a captive market of our own making, ripe for exploitation. The solution to this problem is an innovative, market-based approach to upgrading energy infrastructure and a more realistic environmental mandate; it is not more government regulation. But how likely is that?

Pump prices inching down [San Francisco Chronicle]