JON M. HUNTSMAN, JR.
Governor
GARY R. HERBERT
Lieutenant Governor
State of Utah
Director
Deputy Director
Department of Commerce
FRANCINE A. GIANI
THAD LEVAR
Executive
Gasoline Prices in Utah
A Report to Governor Jon M. Huntsman, Jr
Utah Department of Commerce
October 13, 2006
I. Directive
On September 15, 2006, Governor Jon M. Huntsman directed the Utah Department of
Commerce to probe the ongoing remarkably high retail prices of gasoline in Utah. This report is
presented in response to that directive.
II. Background for Utah Gasoline Prices
A. Utah Refineries and Retailers
Five refineries are located in Utah. The Energy Information Administration, an arm of
the U. S. Department of Energy, has ranked the largest 144 refineries in the United States based
on production as measured by barrels processed per calendar day. The Utah refineries and their
ranking in production are: Tesoro West Coast is number 93 at 58,000 barrels; Chevron USA Inc.
is number 102 at 45,000 barrels; Big West Oil Company (a Flying J Company) is number 111 at
29,400 barrels; Holly Corps Refining & Marketing is number 115 at 24,700 barrels; and Silver
Eagle Refining is number 131 at 10,250 barrels.
Refineries regularly report prices of gasoline at the rack rate. The rack rate is defined by
Renewable Fuels Association (RFA), a national trade association to the United States ethanol
industry, as the “price paid by small independent customers at bulk fuel terminals.” RFA
continues “Refineries traditionally offer a discount from the posted rack rate to their branded
outlets and the largest customers. The size of the discount will vary according to the volume
purchased and the negotiated long-term supply agreements. Although only relatively small
amounts of volumes of gasoline are actually sold at the rack price, rack prices are currently the
only publicly available wholesale pricing information.”
B. Refinery-Owned Retailers vs