1. 09/30/03Presentation by Pat Perez, Manager, Transportation Fuels Office 1 The Causes for Gasoline Price Changes in California During 2003 Presentation to the Pacific Agribusiness Alliance Oxnard, California September 30, 2003 Pat Perez, Manager Transportation Fuels Office California Energy Commission

2. 09/30/03Presentation by Pat Perez, Manager, Transportation Fuels Office 2 Presentation Topics Overview of California’s petroleum market California supply and demand outlook Components of gasoline & diesel prices Price trends and factors affecting fuel prices Responding to short-term and long-term supply issues –Analytical Studies –Recommendations to Governor and Legislature

3. 09/30/03Presentation by Pat Perez, Manager, Transportation Fuels Office 3 Gasoline and Diesel Demand * Note: Year 2003 is January through May only.

4. 09/30/03Presentation by Pat Perez, Manager, Transportation Fuels Office 4 Projected Transportation Demand versus Supply

5. 09/30/03Presentation by Pat Perez, Manager, Transportation Fuels Office 5 Sources of Crude Oil into California Foreign Imports in 2002 (Total = 205 Million Barrels)

6. 09/30/03Presentation by Pat Perez, Manager, Transportation Fuels Office 6 California Refining Utilization

7. 09/30/03Presentation by Pat Perez, Manager, Transportation Fuels Office 7 California Reformulated Gasoline Production January 2003 to Present

8. 09/30/03Presentation by Pat Perez, Manager, Transportation Fuels Office 8 Gasoline Imports into California (Including Blendstocks and Oxygenates)

9. 09/30/03Presentation by Pat Perez, Manager, Transportation Fuels Office 9 Inventories California Gasoline & Blendstocks January 2003 to Present

10. 09/30/03Presentation by Pat Perez, Manager, Transportation Fuels Office 10 Petroleum Flows

11. 09/30/03Presentation by Pat Perez, Manager, Transportation Fuels Office 11 Gasoline and Diesel Comparison 9/15/03 Diesel Price: $1.648 9/15/03 Gasoline Price: $2.034

12. 09/30/03Presentation by Pat Perez, Manager, Transportation Fuels Office 12 Price Trends… Alaska North Slope Crude Oil Prices

13. 09/30/03Presentation by Pat Perez, Manager, Transportation Fuels Office 13 Gasoline Price Comparison Retail Gasoline Prices - California vs. U.S. All Formulations January 2003 to Present

14. 09/30/03Presentation by Pat Perez, Manager, Transportation Fuels Office 14 Diesel Price Comparison Retail Diesel Prices - California vs. U.S. January 2003 to Present

15. 09/30/03Presentation by Pat Perez, Manager, Transportation Fuels Office 15 Recent Studies Feasibility of a Strategic Fuel Reserve in California (July) Reducing California’s Petroleum Dependence (August) Quarterly Report Concerning MTBE Use in California Gasoline (August) Gulf Coast to California Pipeline Feasibility Study (August) Causes for Gasoline and Diesel Price Increases in California (September)

16. 09/30/03Presentation by Pat Perez, Manager, Transportation Fuels Office 16 Key Recommendations to Governor and Legislature Identify a state licensing authority for petroleum storage infrastructure and related facilities Support (without $) proposed petroleum product pipeline capacity expansions and completion and operation of new lines in Nevada, Arizona, New Mexico and Texas Adopt a statewide goal of reducing demand for on-road gasoline and diesel to 15 percent below the 2003 demand level by 2020 Work with the California congressional delegation and other states to establish a national fuel economy standards that double the fuel efficiency of new cars, light trucks and sport utility vehicles Establish a goal to increase the use of non-petroleum fuels to 20% of on-road fuel consumption by 2020 and 30% by 2030

17. 09/30/03Presentation by Pat Perez, Manager, Transportation Fuels Office 17 For More Information about Petroleum Activities… Visit the California Energy Commission’s web site at: www.energy.ca.govwww.energy.ca.gov or call Pat Perez, Manager Transportation Fuels Office Transportation Energy Division pperez@energy.state.ca.us (916) 654-4869