July 24, 2025 • 29 mins
The John Kobylt Show Hour 3 (07/24) - USC Prof. Michael Mische comes on the show to talk about Gov. Newsom looking for a buyer for one of the oil refineries that is closing and why gas prices have gone down recently but he also says this trend is not here to stay. More on how Gov. Newsom ruined the oil industry in the state of California. More on Mayor Bass's obsession with Cuba.
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Speaker 1 (00:00):
Can't.
Speaker 2 (00:01):
I am six forty you're listening to the John Cobel
podcast on the iHeartRadio app. All right, this is the
big story of the day, and it's about the Lateral
Energy closing its refinery up in Benetia in April of
next year. And that part was already announced somehow, it
(00:23):
took a while before it's sunk into Gavin Newsom's thick
skull and he realized, oh crap, if they close, and
then there's another one closing in Wilmington here that Phillips owns.
We're losing anywhere from seventeen to twenty one percent of
our gasoline supply. You're going to see gas prices go
(00:44):
up to eight bucks a gallon. And the guy who
is on this early is a guest we've had on
frequently in recent weeks, and that's Michael mcche the USC
professor who's been analyzing oil and gas prices and keeps
telling you that the reason you pay four fifty a
gallon and it may go up to eight bucks over
the next year and a half, it's entirely self inflicted
(01:07):
by the California government. It's all the taxes, it's all
the regulations, you know, they're selling gas in South Carolina
for two seventy it's four point fifty here, and it's
because of the California legislature and Gavin Newsom.
Speaker 1 (01:21):
That's it. Period.
Speaker 2 (01:23):
Let's get period full stop. Let's get Michael mcche on. Michael,
how are you trific?
Speaker 3 (01:30):
John? How are you today?
Speaker 1 (01:32):
I'm fine?
Speaker 4 (01:33):
Uh.
Speaker 2 (01:34):
Gavin Newsom is now in a state of panic. He's
trying to find any oil company in the world to
buy the Valero refinery and keep it open because Valera
wants to close it they can't make money. I mean,
this is hysterical. He created the environment between the regulations
and the taxes that they had to put this thing
(01:56):
out of business, and now he wants to broker some
kind of deal to say.
Speaker 3 (02:01):
Well, apparently that's true. I mean, he's not only the
chief executive officer of California, but he's the chief real
estate agent apparently too. In terms of trying to find
a suitor for the acquisition of the Valero refinery, which
you know, we need that refinery to stay alive otherwise
(02:22):
we're going to be completely dependent or significantly more dependent
on foreign gasoline sources, and the prices will go up.
Even Vice Chair Gunda of the California Energy Commission admitted
that in his June twenty seventh letter said, you know, well,
we can't really agree with miche, but the prices are
going to go up. And this is something that Senator
(02:43):
Brian Jones and Assemblymen Carl de may have been talking
about for you know, months, if not years of our dependency.
So there's no surprise here, but it apparently took quite
a while for Governor k Newsom's intellectual processes to come around.
Speaker 2 (02:59):
Why would anybody buy this if it's the same regulations
and taxes, it's going to be the same money losing operation.
Speaker 1 (03:07):
What's the incentive to buy this thing?
Speaker 3 (03:09):
Well, that's a great question. So I think we're all
sitting around wondering what type of concessions, incentives, and assurances
the governor is going to provide for anybody that acquires Ballero.
And by the way, whatever those concessions, incentives and assurances are,
then that would be applied to all the surviving refineries.
So I think everybody's sort of sitting around now saying, well,
(03:32):
what are you offering a potential suitor? What are you
offering a potential buyer of this facility in what regulatory
rollbacks and concessions are you going to make to give
that buyer assurances that they can operate in the state
of California with any degree of certainty and continuity.
Speaker 2 (03:54):
They'd have to have an ironclyd contract that Newsom wouldn't
roll back his concessions or some other governor wouldn't roll
back the concessions. And you're right, every remaining company in
California is going to demand the same deal.
Speaker 3 (04:08):
Absolutely. I mean, it's only stance the reason that you
would and why would you? I mean, it's a great question.
Why would you? And they're looking at foreign investors, by
the way, so at least one European refiner that they're
talking to, plus I believe one American. You know, why
would you go through the acquisition process? And by the way,
(04:31):
Valero's board of directors would have to approve it since
it's their asset.
Speaker 1 (04:37):
Right, he can't force a deal against their will, right.
Speaker 3 (04:41):
Yeah, without having some great Yeah, that's correct. It's it's
a shareholder asset, so the board has to approve it
unless the state of California buys it, which I doubt
given twelve billion dollar deficit and a one point six
trillion dollar total debt. I don't see the California buying
it and then trying to sell it. It's it's it's
a broker's deal. But it's going to come down to
(05:04):
the concessions and centives and insurances that are offered to
the buyer, in which case those same concessions, incentives, and
insurances have to be offered to the surviving refineries here
in our state. Well, quite a dilemma if you think
about it.
Speaker 2 (05:20):
Could this be? Could this bring the end of these
stupid regulations and these stupid taxes that that has crushed
the oil industry. Are they going to have to give
up entirely?
Speaker 3 (05:33):
Well, I think there has to be some significant changes
occurring in Sacramento, and certainly we're seeing those coming out
of Washington, d c. Under President Trump's leadership on some
of these issues. But Sacramento is going to have to
make some serious changes to how they regulate the energy
policies in the state. And also a lot of this
(05:56):
is driven by climate change type initiatives. But when you
read the studies and the research, California accounts for less
than one percent of global global emission issue. Yeah right,
So so really by burning the California taxpayer, in the
California consumer, with all of these programs, is it really
(06:18):
worth it or have we reached a point of diminishing returns?
But with these two refineries shutting down, that is a
day of reckoning, and so unless that reckoning is addressed now,
it'll be a much much bigger problem for California.
Speaker 2 (06:33):
They were warned for many, many years, ever since they
went on this kick of climate regulations and high taxes.
Everybody told them, And only now here in July of
twenty twenty five do they wake up and go, oh
my god, we've destroyed the oil industry.
Speaker 3 (06:49):
Well, because the reality of these two refineries have finally hit.
And when you're looking at twenty percent or twenty one
percent reduction in supply, the question then becomes, well, how
do you how do you replace that? Well, you're going
to replace it with foreign source gasoline. You have to
transport it here, that's going to add about fifteen to
seventeen cents a gallon, You have to buy it that's
(07:11):
going to have a premium attached to it, and you
have very complex supply chains which are very fragile, anything
like a port labor dispute, maritime transit disputes, geopolitical situations,
bad weather that will absolutely affect the supply chain. And
(07:31):
as we know in California, we're very sensitive to disruptions
and in production and supply chains and gasoline when we're
all too familiar with spikes that occur. So this is
a setup and it's been talked about for a long time,
but with these two refineries definitively shutting down, the reality
(07:53):
hits the day reckoning is not too far away.
Speaker 1 (07:56):
Can you hold on for another segment?
Speaker 2 (07:59):
I'd love to because I want to talk about exactly
how high the price would go and the whole process
of trying to get oil now from these far off
lands to replace it. They Newson wrote a letter today
and actually admitted he wrote a letter to Siva Gunda,
the California Energy Commission Vice chair, and he wrote at
(08:20):
the end of it that we have to have a safe,
affordable and reliable supply of fuels over the next two decades.
So he admitted that oil and gas are going to
be with us for quite a while. More coming up
with Michael mccheff, the USC professor.
Speaker 4 (08:41):
You're listening to John Cobelt on demand from KFI AM
six forty.
Speaker 2 (08:47):
We continue with Michael mcche the USC professor, has done
so much research into gas and oil prices here in California,
and we're specifically as honing in on the Villero company.
They have announced that they are going to for sure
close a refinery up in Denetia in northern California. That
along with a closing of a Phillips refinery here in
(09:12):
Wilmington in the LA area, we're losing seventeen eighteen percent
of our gas refining capacity and that could send the
price up considerably.
Speaker 1 (09:25):
Now, I saw in one of these.
Speaker 2 (09:27):
Stories here, I got a lot of them in front
of me that the state, the state data indicates that
we could get eight dollars a gallon, which is something
you talked about a few weeks ago. So is that
a real number? If all this comes to pass, we
actually lose all that refining capacity, afraid?
Speaker 3 (09:45):
So, I mean it's a very real possibility because it's
based on supply and demand. So our supply of fuel
is coming down faster than our demand. Our demand is
not coming down nearly as quickly as carb had forecast.
In predicted or the CEC. So our supplies are coming
down much quicker. So the question then becomes to what
(10:07):
extent can you replenish the supply to achieve equal agrium
in the market and bring their prices in line. So,
you know, the state is now sort of coming around saying,
all right, maybe Mache's worst case scenario really is, you know,
a possibility that we need to avoid, and we all
want to avoid eight dollars gasoline prices, there's no question
(10:29):
about that. The real issue also becomes that if we
lose the refinery in Northern California, and we lose the
pipeline that provides oil from Southern California fields to the
Northern California refinery due to capacity issues, then Northern California
may have to import as much as fifty percent of
(10:50):
its daily gasoline use from foreign sources, and some of
those foreign sources will be as far away as India
and even Saudi Arabia on a tanker truck tanker vessel
coming across the Pacific, you know, forty forty five days
with a lot of greenhouse emissions associated with it. So this,
this is a very real possibility that perhaps the state
(11:12):
is actually coming, you know, realistically coming to the conclusion
that you know, these are these are possibilities.
Speaker 2 (11:20):
Yeah, so Saudi Arabia, India will have to ship us
is it their oil or the refined gas because ever
had one story which says the oil could go then
to a country like South Korea which would find it
into the gas and then they'd have to ship that
over here, so it'd be too long shipments on the oceans.
Speaker 3 (11:40):
Well, we did oil already from foreign sources. So about
sixty three percent of our oil's actually coming from non
US sources right now, even though California is sixty three,
even though California sits on about the seventh largest reserves
in the United States. I mean, we're standing on oil
as we speak and as we as we worked every day,
(12:01):
which could be used to bring down the state's debt
and deficit and things like that.
Speaker 2 (12:05):
So we're not cutting any emissions. If we're getting almost
two thirds of oil overseas and then they have to
ship it in tankers across oceans, there is no emission
savings for these climate change fanatics.
Speaker 3 (12:19):
Yeah, probably not. And now with the reduction in refineries,
you're going to be shipping gasoline on tankers across the Pacific.
Now the question then becomes, let's say you get that
gasoline from a refinery in India, Well, most likely that
oil that's made, you know, the gasoline that's made from
(12:39):
that oil in India is coming from Russia. If you're
getting the gasoline made in China, then the oil that's
used to make the gasoline there is coming from Russia,
Iran and Venezuela, or you get it from South Korea
and it's going to come from Saudi Arabia.
Speaker 2 (12:55):
All right, But instead of drilling for the oil here
and refining it into gasoline here, we've got two tanker trips,
one from the oil producing country, then they send it
to the gas refinery in a second country, and then
it comes here.
Speaker 3 (13:11):
Yeah, you got it makes perfect sense, right involved are
sitting on the seventh largest reserves. I mean, the absurdity
of it is defies, you know, honestly description, in defies logic.
Speaker 1 (13:24):
Yeah.
Speaker 2 (13:24):
I tell this to people and they can't believe it.
I mean, they just can't believe that we have a
government this stupid. In Gavin Newsom's letter to the vice
chair of the California Energy Commission, he writes that in California,
California is a market where demand for gasoline will exist
for years to come.
Speaker 1 (13:44):
Now he admits this, well, you.
Speaker 3 (13:49):
Know, let's give let's give the governor some credit for
reading my work. And I mean, look, you know, look
he did his homework. I mean, he read the assignments.
You may not agree with him, but let's give him
some credit for that. And let's give him some credit
for listening to people like Brian Jones and Carl Demalio
and people like that. Did it have been saying, look,
(14:09):
this is a significant problem and if you don't address it,
it's going to become borderline catastrophic. Now, that whole thing
about twenty thirty five was an arbitrary date. It was
a contrived date put the electric car man date the
electric car mandate that got rolled back by the federal government.
And now I believe he's talking twenty forty five, which
(14:31):
is actually a more realistic date that comes out of
my work. I said, you know, probably the sweet spot
for their great transition and energy will be between twenty
forty five and twenty fifty five. And this is how
you're going to get there, and this is how you're
going to do it without destroying the markets and without
destroying the pocketbooks of hard work in Californians. So, you know,
(14:52):
there's clearly been a revelation on the part of the governor,
and you know, let's face it, he probably has national
political aspirations and the last thing he wants to do
is is go into the heartland of America and say, hey,
guess what. You know you have two dollars and eighty
cents a gallon gasoline. I can make it. I can
make it ten dollars.
Speaker 1 (15:10):
How many refinery? Yeah, sorry, go ahead.
Speaker 3 (15:13):
I don't think it wants to do that, right.
Speaker 2 (15:15):
No, I don't think you're going to win on that.
How many refineries we have left in the state.
Speaker 3 (15:21):
When these two go down, we'll have seven producing gasoline
for the fourth largest economy in the world.
Speaker 2 (15:26):
Seven And we I read back in the year two
thousand we had over twenty.
Speaker 3 (15:31):
Oh we had you know, if you look over the
course of time, we had forty three at one time
three Yeah, we had forty three, forty three to seven
And and you know, are that's just not the absolute
number of refineries, it's also the capacity of those refineries
has gone down. That's why we've had an import gasoline
(15:52):
before from various countries and also Washington State, so you
know it's it's been a problem, but now it's it's
clearly going to be a larger problem if if, indeed
we don't find a suitor for for Valero.
Speaker 2 (16:08):
Michael Miche USC professor, thank you for coming on.
Speaker 3 (16:12):
Oh John, So it was a pleasure beyond with you. John.
Speaker 4 (16:14):
All right, you're listening to John Cobels on demand from
KFI AM six forty.
Speaker 1 (16:21):
John Cobelt Show.
Speaker 2 (16:22):
Moistline is eight seven seven Moist Dady six, last call
eight seven seven Moist staty six.
Speaker 1 (16:26):
We have room, we have.
Speaker 2 (16:27):
Vacancies or use the talkback feature on the iHeartRadio app.
We just had Michael Mache on for the last half hour,
and State Modeling now says, yeah, we could hit eight
dollars a.
Speaker 1 (16:37):
Gallon in gas by next spring.
Speaker 2 (16:40):
Once the Valero refinery and Benetia closes and the one
in Wilmington run by Phillips. And yes, we get two thirds,
almost two thirds, sixty three percent of our oil and
gas from foreign countries. And we said at the end,
(17:01):
you have oil being refined in one country like Saudi Arabia,
put on a tanker. Well, no, you have oil that's
being extractive in one country, put on a tanker. Then
they send it to a second country to be refined
into gas. So you have two tanker trips across oceans.
Can you imagine the amount of emissions. The whole climate
(17:24):
change thing is complete nonsense. That was a cover story
for Newsom and the legislature to lay on all these taxes.
Speaker 1 (17:32):
Make us feel guilty.
Speaker 2 (17:33):
It's just like the homeless scam, right, Homeless taxes make
us feel guilty. Climate change we're all gonna die. Climate
change taxes make us feel guilty. It's one big scam.
The whole thing is a scam because more emissions are
being put out by travel. By forcing all this oil
and gas to travel all around the world before it
(17:55):
gets here. We're sitting on the seventh largest reserve in
the country of oil. We've closed most of the refineries.
Used to be forty three, now it's gonna be seven
after these two closes.
Speaker 1 (18:10):
You know.
Speaker 2 (18:11):
And Newsom is now again positioning himself as the white Knight,
the hero on the horse. Hey, look what I'm gonna
do here. I'm gonna end you. I'm gonna broker a deal.
I'm gonna engineer a deal with some foreign country so
they some foreign companies so they could take over the
Valero refinery in Benetia, and I'll singleheadedly prevent eight dollars
(18:31):
a gallon gas. It's like you created this. These were
all your policies. You should apologize and you should resign,
and the state should repeal all these taxes, all the
climate change taxes, all the regulations all should be repealed.
All the money over the last twenty years ought to
be refunded. That's what it to happen. And Newsom and
(18:53):
the California legislator legislature want to.
Speaker 1 (18:55):
Go to jail.
Speaker 2 (18:56):
That's what they stole, untold billions of dollar from US
for no reason. It had no effect on the atmosphere,
none at all. In fact, they probably pumped more emissions
into the atmosphere by having two tankers take the oil
and then take the gas across all these oceans. Sixty
(19:17):
three percent of our oil and gas is imported from
foreign countries. Sixty three percent. You have been scammed. Fortunately,
I think this error is coming to an end. Trump
administration has a plan to repeal.
Speaker 1 (19:35):
To end.
Speaker 2 (19:37):
The EPA and their climate change policies. The proposed EPA
rule will rescind a declaration from two thousand and nine,
and they are just going to in writing completely reject
the whole climate change greenhouse gas concept. There will no
(19:59):
longer fighting it. They're no longer going to even acknowledge
climate change, which is the way it should be. This
has been a massive scam in boondoggle, and it's proven
by what's going on in California. And I was just
reading here Tesla stock dropped, has dropped as much as
ten percent this morning because sales are way down. Free
(20:21):
La on Musk He says, there's a few rough quarters ahead.
So there you go, the one successful electric car company
and all these left wing climate fanatics are trying to
put it out of business because he was dallying with
Trump for a while. Yeah, they don't care about climate change.
It was virtue signaling. And the only reason he was
(20:41):
making profits on Tesla is was your tax money. He
is the one who got a good chunk of his
wealth off the backs of taxpayers because we were subsidizing
all the Tesla's. Now the idiot climate change loving Tesla
owners are giving up on their cars and tanking company.
This is all craziness, This is all insanity, a med
(21:05):
but people go along with this stuff. Oh, I'm trying
to save the planet. I'm trying to do my part.
You're not saving the planet. You're not doing your part.
This is self pleasure, is what it is. You're engaging
in psychic self pleasure. So the EPA, the proposal is
going to be made public in a few days and
(21:27):
they're just gonna get rid of the limits on tailpipe
emissions that were added on recently.
Speaker 1 (21:35):
This all Biden administration nonsense of.
Speaker 2 (21:38):
It, All these homeless racket, the whole COVID racket, the
climate change racket. It's just about stealing huge enormous sums
of money from ordinary people and in the process trying
to make you feel guilty. They can only get away
with this if you succumb to their guilt, if you
allow them to emotionally manipulate. It doesn't work without the
(22:01):
emotional manipulation. And you know what, when this whole, when
the scam is up, you know to something, When when
Trump got rid of California's electric car requirement for twenty
thirty five, I don't see any protests in the street
I don't see anybody upset because all the past protests
were fake.
Speaker 1 (22:20):
They were fake, they were paid for.
Speaker 2 (22:24):
Protests, financed by people who would profit from these green
energy scams. It's like the illegal alien protests. All the
raids are still going on. It didn't stop anything because
you can't. But for a time, especially, you know, for
(22:45):
a group like Charlie, it gets tax money, they'll spend
the tax money to create a ruckus so they get
more donations for their cause. But they're not stopping illegal
immigration deportations, and nobody's affected the climate. This is all
colossal nonsense that too many people fell for.
Speaker 4 (23:10):
You're listening to John Cobels on demand from KFI AM
six forty.
Speaker 2 (23:15):
And after four o'clock you will hear the podcast. In
case you missed what we did today. We just had
Michael miche on earlier this hour and he talked about
now now state state modeling data is showing eight dollars
gallon gas next year that Laro refinery supposed to close,
(23:37):
and now Gavin Newsom is panicking. He's looking to find
a buyer for the refinery up in northern California. And
we'll do more on that tomorrow because that's going to
be highly entertaining. Now he's panicking often lately, I've been
telling you about something that should have been covered in
(23:59):
great detail al and spelled. It would has spared a
lot of people a lot of heartache. Karen Bass was
a committed communist back in her younger days, going back
to the nineteen seventies, when she was in her twenties,
and she used to go with this, with this then
Samos Brigade, I think, is how you pronounce it, And
(24:23):
they go to Cuba. And she went to Cuba eight
times with this group, and then she afterwards, after she
left the group, she went many more times.
Speaker 1 (24:33):
And she was completely.
Speaker 2 (24:34):
Enamored with the communist system in Cuba, and really enamored
with Fidel Castro. Thought he was just so dynamic and charismatic.
This is all I had newspapers on that time. The
story popped up today what Cuba is like for some people.
(24:55):
In fact, you read the first three paragraphs of this story,
it's from Yahoo News, and it's hard to tell if
this is a story out of Havana or Los Angeles.
Talks about a man named William Aybell. William. There's a
photo of him looking inside a plastic bag that he
dug out of a trash can. He was scrounging for
his meal, and what he got out of the trash
(25:17):
can was rice, vegetables, a chicken bone with no chicken
meat on it, and flies. So he pulls out a
meatless chicken bone with flies, rice and vegetables. Sixty two
years old. He's been sleeping on the streets since his
house collapsed, and that happens a lot in Havana.
Speaker 1 (25:38):
No, this is not Los Angeles.
Speaker 2 (25:39):
This is Havana because of the dilapidation of many buildings.
The economy is in ruins. That house is a symbol
of the economy. Food is the hardest part. I've been
rummaging through trash cans for two years to eat. It's hard.
It's hard to understand him, Corney of the reporter, because
he has many missing teeth. Where's a grimy t shirt.
(26:03):
Abel's body is a skeletal He admits he used to
drink quite a lot. He would be at home here
in La But this is what communist governments and communist
economics bring you. Abel is one of a group of
visibly growing beggars and homeless people in a country with
(26:24):
its worst economic crisis in three decades. The Labor and
Social Security Minister resigned in Cuba. She claimed there are
no beggars in the communist state. It's you know, it's
it's it's socialism. It's communism. Food prices of skyrocketed five
(26:44):
hundred percent in Cuba. The word poor is never used
in official communications. They call it vulnerable people. That's what
left wing people do, is they they invent a new
language to cover up all the atrocities that their policies cause.
There's another guy, one de la Cruz. He sat on
(27:06):
the street with a piece of cardboard that said, please
something to eat. The social security. The social security that
they get down there amounts to less than three dollars
a month. God, you can't even buy a small amount
(27:27):
of chicken. And even if you go to the soup kitchen,
the food is bad. You get rice without butter, without oil.
He sleeps in a very small room, but it's completely empty,
and one in ten Cuban children live in severe child
food poverty. They want to elect a socialist communist in
(27:49):
New York City who wants the government to run the
grocery stores. We have a socialist communist running Los Angeles.
There's also one running in Chicago. We have a massive
amount of homelessness and poverty, drug addicts, and mental patients
in the streets. By the way, I went to Hollywood
last night to go see a play. Oh my god.
I don't know what all the tourists must think when
(28:11):
they go on their dream vacation with their family. A
lot of wives and husbands and their kids with them,
and woof walking down Hollywood Boulevard and all these crazy
people shouting into the air, garbage everywhere.
Speaker 1 (28:29):
And I'm looking around.
Speaker 2 (28:30):
It's like, why would you allow this area that gets
millions of tourists to be filled with garbage and dangerous,
insane people. But you know, you have a mayor who
is politically formed by her experiences in Cuba. You read
(28:52):
that story and just cross that Havana and put in
Los Angeles makes perfect sense. Michael Krauzer is the News
Way is next. Michael's Live in the CAFI twenty four
hour Newsroom. Hey, you've been listening to the John Cobalt
Show podcast. You can always hear the show live on
KFI Am six forty from one to four pm every
Monday through Friday, and of course anytime on demand on
(29:13):
the iHeartRadio app.
Can't.
Speaker 2 (00:01):
I am six forty you're listening to the John Cobel
podcast on the iHeartRadio app. All right, this is the
big story of the day, and it's about the Lateral
Energy closing its refinery up in Benetia in April of
next year. And that part was already announced somehow, it
(00:23):
took a while before it's sunk into Gavin Newsom's thick
skull and he realized, oh crap, if they close, and
then there's another one closing in Wilmington here that Phillips owns.
We're losing anywhere from seventeen to twenty one percent of
our gasoline supply. You're going to see gas prices go
(00:44):
up to eight bucks a gallon. And the guy who
is on this early is a guest we've had on
frequently in recent weeks, and that's Michael mcche the USC
professor who's been analyzing oil and gas prices and keeps
telling you that the reason you pay four fifty a
gallon and it may go up to eight bucks over
the next year and a half, it's entirely self inflicted
(01:07):
by the California government. It's all the taxes, it's all
the regulations, you know, they're selling gas in South Carolina
for two seventy it's four point fifty here, and it's
because of the California legislature and Gavin Newsom.
Speaker 1 (01:21):
That's it. Period.
Speaker 2 (01:23):
Let's get period full stop. Let's get Michael mcche on. Michael,
how are you trific?
Speaker 3 (01:30):
John? How are you today?
Speaker 1 (01:32):
I'm fine?
Speaker 4 (01:33):
Uh.
Speaker 2 (01:34):
Gavin Newsom is now in a state of panic. He's
trying to find any oil company in the world to
buy the Valero refinery and keep it open because Valera
wants to close it they can't make money. I mean,
this is hysterical. He created the environment between the regulations
and the taxes that they had to put this thing
(01:56):
out of business, and now he wants to broker some
kind of deal to say.
Speaker 3 (02:01):
Well, apparently that's true. I mean, he's not only the
chief executive officer of California, but he's the chief real
estate agent apparently too. In terms of trying to find
a suitor for the acquisition of the Valero refinery, which
you know, we need that refinery to stay alive otherwise
(02:22):
we're going to be completely dependent or significantly more dependent
on foreign gasoline sources, and the prices will go up.
Even Vice Chair Gunda of the California Energy Commission admitted
that in his June twenty seventh letter said, you know, well,
we can't really agree with miche, but the prices are
going to go up. And this is something that Senator
(02:43):
Brian Jones and Assemblymen Carl de may have been talking
about for you know, months, if not years of our dependency.
So there's no surprise here, but it apparently took quite
a while for Governor k Newsom's intellectual processes to come around.
Speaker 2 (02:59):
Why would anybody buy this if it's the same regulations
and taxes, it's going to be the same money losing operation.
Speaker 1 (03:07):
What's the incentive to buy this thing?
Speaker 3 (03:09):
Well, that's a great question. So I think we're all
sitting around wondering what type of concessions, incentives, and assurances
the governor is going to provide for anybody that acquires Ballero.
And by the way, whatever those concessions, incentives and assurances are,
then that would be applied to all the surviving refineries.
So I think everybody's sort of sitting around now saying, well,
(03:32):
what are you offering a potential suitor? What are you
offering a potential buyer of this facility in what regulatory
rollbacks and concessions are you going to make to give
that buyer assurances that they can operate in the state
of California with any degree of certainty and continuity.
Speaker 2 (03:54):
They'd have to have an ironclyd contract that Newsom wouldn't
roll back his concessions or some other governor wouldn't roll
back the concessions. And you're right, every remaining company in
California is going to demand the same deal.
Speaker 3 (04:08):
Absolutely. I mean, it's only stance the reason that you
would and why would you? I mean, it's a great question.
Why would you? And they're looking at foreign investors, by
the way, so at least one European refiner that they're
talking to, plus I believe one American. You know, why
would you go through the acquisition process? And by the way,
(04:31):
Valero's board of directors would have to approve it since
it's their asset.
Speaker 1 (04:37):
Right, he can't force a deal against their will, right.
Speaker 3 (04:41):
Yeah, without having some great Yeah, that's correct. It's it's
a shareholder asset, so the board has to approve it
unless the state of California buys it, which I doubt
given twelve billion dollar deficit and a one point six
trillion dollar total debt. I don't see the California buying
it and then trying to sell it. It's it's it's
a broker's deal. But it's going to come down to
(05:04):
the concessions and centives and insurances that are offered to
the buyer, in which case those same concessions, incentives, and
insurances have to be offered to the surviving refineries here
in our state. Well, quite a dilemma if you think
about it.
Speaker 2 (05:20):
Could this be? Could this bring the end of these
stupid regulations and these stupid taxes that that has crushed
the oil industry. Are they going to have to give
up entirely?
Speaker 3 (05:33):
Well, I think there has to be some significant changes
occurring in Sacramento, and certainly we're seeing those coming out
of Washington, d c. Under President Trump's leadership on some
of these issues. But Sacramento is going to have to
make some serious changes to how they regulate the energy
policies in the state. And also a lot of this
(05:56):
is driven by climate change type initiatives. But when you
read the studies and the research, California accounts for less
than one percent of global global emission issue. Yeah right,
So so really by burning the California taxpayer, in the
California consumer, with all of these programs, is it really
(06:18):
worth it or have we reached a point of diminishing returns?
But with these two refineries shutting down, that is a
day of reckoning, and so unless that reckoning is addressed now,
it'll be a much much bigger problem for California.
Speaker 2 (06:33):
They were warned for many, many years, ever since they
went on this kick of climate regulations and high taxes.
Everybody told them, And only now here in July of
twenty twenty five do they wake up and go, oh
my god, we've destroyed the oil industry.
Speaker 3 (06:49):
Well, because the reality of these two refineries have finally hit.
And when you're looking at twenty percent or twenty one
percent reduction in supply, the question then becomes, well, how
do you how do you replace that? Well, you're going
to replace it with foreign source gasoline. You have to
transport it here, that's going to add about fifteen to
seventeen cents a gallon, You have to buy it that's
(07:11):
going to have a premium attached to it, and you
have very complex supply chains which are very fragile, anything
like a port labor dispute, maritime transit disputes, geopolitical situations,
bad weather that will absolutely affect the supply chain. And
(07:31):
as we know in California, we're very sensitive to disruptions
and in production and supply chains and gasoline when we're
all too familiar with spikes that occur. So this is
a setup and it's been talked about for a long time,
but with these two refineries definitively shutting down, the reality
(07:53):
hits the day reckoning is not too far away.
Speaker 1 (07:56):
Can you hold on for another segment?
Speaker 2 (07:59):
I'd love to because I want to talk about exactly
how high the price would go and the whole process
of trying to get oil now from these far off
lands to replace it. They Newson wrote a letter today
and actually admitted he wrote a letter to Siva Gunda,
the California Energy Commission Vice chair, and he wrote at
(08:20):
the end of it that we have to have a safe,
affordable and reliable supply of fuels over the next two decades.
So he admitted that oil and gas are going to
be with us for quite a while. More coming up
with Michael mccheff, the USC professor.
Speaker 4 (08:41):
You're listening to John Cobelt on demand from KFI AM
six forty.
Speaker 2 (08:47):
We continue with Michael mcche the USC professor, has done
so much research into gas and oil prices here in California,
and we're specifically as honing in on the Villero company.
They have announced that they are going to for sure
close a refinery up in Denetia in northern California. That
along with a closing of a Phillips refinery here in
(09:12):
Wilmington in the LA area, we're losing seventeen eighteen percent
of our gas refining capacity and that could send the
price up considerably.
Speaker 1 (09:25):
Now, I saw in one of these.
Speaker 2 (09:27):
Stories here, I got a lot of them in front
of me that the state, the state data indicates that
we could get eight dollars a gallon, which is something
you talked about a few weeks ago. So is that
a real number? If all this comes to pass, we
actually lose all that refining capacity, afraid?
Speaker 3 (09:45):
So, I mean it's a very real possibility because it's
based on supply and demand. So our supply of fuel
is coming down faster than our demand. Our demand is
not coming down nearly as quickly as carb had forecast.
In predicted or the CEC. So our supplies are coming
down much quicker. So the question then becomes to what
(10:07):
extent can you replenish the supply to achieve equal agrium
in the market and bring their prices in line. So,
you know, the state is now sort of coming around saying,
all right, maybe Mache's worst case scenario really is, you know,
a possibility that we need to avoid, and we all
want to avoid eight dollars gasoline prices, there's no question
(10:29):
about that. The real issue also becomes that if we
lose the refinery in Northern California, and we lose the
pipeline that provides oil from Southern California fields to the
Northern California refinery due to capacity issues, then Northern California
may have to import as much as fifty percent of
(10:50):
its daily gasoline use from foreign sources, and some of
those foreign sources will be as far away as India
and even Saudi Arabia on a tanker truck tanker vessel
coming across the Pacific, you know, forty forty five days
with a lot of greenhouse emissions associated with it. So this,
this is a very real possibility that perhaps the state
(11:12):
is actually coming, you know, realistically coming to the conclusion
that you know, these are these are possibilities.
Speaker 2 (11:20):
Yeah, so Saudi Arabia, India will have to ship us
is it their oil or the refined gas because ever
had one story which says the oil could go then
to a country like South Korea which would find it
into the gas and then they'd have to ship that
over here, so it'd be too long shipments on the oceans.
Speaker 3 (11:40):
Well, we did oil already from foreign sources. So about
sixty three percent of our oil's actually coming from non
US sources right now, even though California is sixty three,
even though California sits on about the seventh largest reserves
in the United States. I mean, we're standing on oil
as we speak and as we as we worked every day,
(12:01):
which could be used to bring down the state's debt
and deficit and things like that.
Speaker 2 (12:05):
So we're not cutting any emissions. If we're getting almost
two thirds of oil overseas and then they have to
ship it in tankers across oceans, there is no emission
savings for these climate change fanatics.
Speaker 3 (12:19):
Yeah, probably not. And now with the reduction in refineries,
you're going to be shipping gasoline on tankers across the Pacific.
Now the question then becomes, let's say you get that
gasoline from a refinery in India, Well, most likely that
oil that's made, you know, the gasoline that's made from
(12:39):
that oil in India is coming from Russia. If you're
getting the gasoline made in China, then the oil that's
used to make the gasoline there is coming from Russia,
Iran and Venezuela, or you get it from South Korea
and it's going to come from Saudi Arabia.
Speaker 2 (12:55):
All right, But instead of drilling for the oil here
and refining it into gasoline here, we've got two tanker trips,
one from the oil producing country, then they send it
to the gas refinery in a second country, and then
it comes here.
Speaker 3 (13:11):
Yeah, you got it makes perfect sense, right involved are
sitting on the seventh largest reserves. I mean, the absurdity
of it is defies, you know, honestly description, in defies logic.
Speaker 1 (13:24):
Yeah.
Speaker 2 (13:24):
I tell this to people and they can't believe it.
I mean, they just can't believe that we have a
government this stupid. In Gavin Newsom's letter to the vice
chair of the California Energy Commission, he writes that in California,
California is a market where demand for gasoline will exist
for years to come.
Speaker 1 (13:44):
Now he admits this, well, you.
Speaker 3 (13:49):
Know, let's give let's give the governor some credit for
reading my work. And I mean, look, you know, look
he did his homework. I mean, he read the assignments.
You may not agree with him, but let's give him
some credit for that. And let's give him some credit
for listening to people like Brian Jones and Carl Demalio
and people like that. Did it have been saying, look,
(14:09):
this is a significant problem and if you don't address it,
it's going to become borderline catastrophic. Now, that whole thing
about twenty thirty five was an arbitrary date. It was
a contrived date put the electric car man date the
electric car mandate that got rolled back by the federal government.
And now I believe he's talking twenty forty five, which
(14:31):
is actually a more realistic date that comes out of
my work. I said, you know, probably the sweet spot
for their great transition and energy will be between twenty
forty five and twenty fifty five. And this is how
you're going to get there, and this is how you're
going to do it without destroying the markets and without
destroying the pocketbooks of hard work in Californians. So, you know,
(14:52):
there's clearly been a revelation on the part of the governor,
and you know, let's face it, he probably has national
political aspirations and the last thing he wants to do
is is go into the heartland of America and say, hey,
guess what. You know you have two dollars and eighty
cents a gallon gasoline. I can make it. I can
make it ten dollars.
Speaker 1 (15:10):
How many refinery? Yeah, sorry, go ahead.
Speaker 3 (15:13):
I don't think it wants to do that, right.
Speaker 2 (15:15):
No, I don't think you're going to win on that.
How many refineries we have left in the state.
Speaker 3 (15:21):
When these two go down, we'll have seven producing gasoline
for the fourth largest economy in the world.
Speaker 2 (15:26):
Seven And we I read back in the year two
thousand we had over twenty.
Speaker 3 (15:31):
Oh we had you know, if you look over the
course of time, we had forty three at one time
three Yeah, we had forty three, forty three to seven
And and you know, are that's just not the absolute
number of refineries, it's also the capacity of those refineries
has gone down. That's why we've had an import gasoline
(15:52):
before from various countries and also Washington State, so you
know it's it's been a problem, but now it's it's
clearly going to be a larger problem if if, indeed
we don't find a suitor for for Valero.
Speaker 2 (16:08):
Michael Miche USC professor, thank you for coming on.
Speaker 3 (16:12):
Oh John, So it was a pleasure beyond with you. John.
Speaker 4 (16:14):
All right, you're listening to John Cobels on demand from
KFI AM six forty.
Speaker 1 (16:21):
John Cobelt Show.
Speaker 2 (16:22):
Moistline is eight seven seven Moist Dady six, last call
eight seven seven Moist staty six.
Speaker 1 (16:26):
We have room, we have.
Speaker 2 (16:27):
Vacancies or use the talkback feature on the iHeartRadio app.
We just had Michael Mache on for the last half hour,
and State Modeling now says, yeah, we could hit eight
dollars a.
Speaker 1 (16:37):
Gallon in gas by next spring.
Speaker 2 (16:40):
Once the Valero refinery and Benetia closes and the one
in Wilmington run by Phillips. And yes, we get two thirds,
almost two thirds, sixty three percent of our oil and
gas from foreign countries. And we said at the end,
(17:01):
you have oil being refined in one country like Saudi Arabia,
put on a tanker. Well, no, you have oil that's
being extractive in one country, put on a tanker. Then
they send it to a second country to be refined
into gas. So you have two tanker trips across oceans.
Can you imagine the amount of emissions. The whole climate
(17:24):
change thing is complete nonsense. That was a cover story
for Newsom and the legislature to lay on all these taxes.
Speaker 1 (17:32):
Make us feel guilty.
Speaker 2 (17:33):
It's just like the homeless scam, right, Homeless taxes make
us feel guilty. Climate change we're all gonna die. Climate
change taxes make us feel guilty. It's one big scam.
The whole thing is a scam because more emissions are
being put out by travel. By forcing all this oil
and gas to travel all around the world before it
(17:55):
gets here. We're sitting on the seventh largest reserve in
the country of oil. We've closed most of the refineries.
Used to be forty three, now it's gonna be seven
after these two closes.
Speaker 1 (18:10):
You know.
Speaker 2 (18:11):
And Newsom is now again positioning himself as the white Knight,
the hero on the horse. Hey, look what I'm gonna
do here. I'm gonna end you. I'm gonna broker a deal.
I'm gonna engineer a deal with some foreign country so
they some foreign companies so they could take over the
Valero refinery in Benetia, and I'll singleheadedly prevent eight dollars
(18:31):
a gallon gas. It's like you created this. These were
all your policies. You should apologize and you should resign,
and the state should repeal all these taxes, all the
climate change taxes, all the regulations all should be repealed.
All the money over the last twenty years ought to
be refunded. That's what it to happen. And Newsom and
(18:53):
the California legislator legislature want to.
Speaker 1 (18:55):
Go to jail.
Speaker 2 (18:56):
That's what they stole, untold billions of dollar from US
for no reason. It had no effect on the atmosphere,
none at all. In fact, they probably pumped more emissions
into the atmosphere by having two tankers take the oil
and then take the gas across all these oceans. Sixty
(19:17):
three percent of our oil and gas is imported from
foreign countries. Sixty three percent. You have been scammed. Fortunately,
I think this error is coming to an end. Trump
administration has a plan to repeal.
Speaker 1 (19:35):
To end.
Speaker 2 (19:37):
The EPA and their climate change policies. The proposed EPA
rule will rescind a declaration from two thousand and nine,
and they are just going to in writing completely reject
the whole climate change greenhouse gas concept. There will no
(19:59):
longer fighting it. They're no longer going to even acknowledge
climate change, which is the way it should be. This
has been a massive scam in boondoggle, and it's proven
by what's going on in California. And I was just
reading here Tesla stock dropped, has dropped as much as
ten percent this morning because sales are way down. Free
(20:21):
La on Musk He says, there's a few rough quarters ahead.
So there you go, the one successful electric car company
and all these left wing climate fanatics are trying to
put it out of business because he was dallying with
Trump for a while. Yeah, they don't care about climate change.
It was virtue signaling. And the only reason he was
(20:41):
making profits on Tesla is was your tax money. He
is the one who got a good chunk of his
wealth off the backs of taxpayers because we were subsidizing
all the Tesla's. Now the idiot climate change loving Tesla
owners are giving up on their cars and tanking company.
This is all craziness, This is all insanity, a med
(21:05):
but people go along with this stuff. Oh, I'm trying
to save the planet. I'm trying to do my part.
You're not saving the planet. You're not doing your part.
This is self pleasure, is what it is. You're engaging
in psychic self pleasure. So the EPA, the proposal is
going to be made public in a few days and
(21:27):
they're just gonna get rid of the limits on tailpipe
emissions that were added on recently.
Speaker 1 (21:35):
This all Biden administration nonsense of.
Speaker 2 (21:38):
It, All these homeless racket, the whole COVID racket, the
climate change racket. It's just about stealing huge enormous sums
of money from ordinary people and in the process trying
to make you feel guilty. They can only get away
with this if you succumb to their guilt, if you
allow them to emotionally manipulate. It doesn't work without the
(22:01):
emotional manipulation. And you know what, when this whole, when
the scam is up, you know to something, When when
Trump got rid of California's electric car requirement for twenty
thirty five, I don't see any protests in the street
I don't see anybody upset because all the past protests
were fake.
Speaker 1 (22:20):
They were fake, they were paid for.
Speaker 2 (22:24):
Protests, financed by people who would profit from these green
energy scams. It's like the illegal alien protests. All the
raids are still going on. It didn't stop anything because
you can't. But for a time, especially, you know, for
(22:45):
a group like Charlie, it gets tax money, they'll spend
the tax money to create a ruckus so they get
more donations for their cause. But they're not stopping illegal
immigration deportations, and nobody's affected the climate. This is all
colossal nonsense that too many people fell for.
Speaker 4 (23:10):
You're listening to John Cobels on demand from KFI AM
six forty.
Speaker 2 (23:15):
And after four o'clock you will hear the podcast. In
case you missed what we did today. We just had
Michael miche on earlier this hour and he talked about
now now state state modeling data is showing eight dollars
gallon gas next year that Laro refinery supposed to close,
(23:37):
and now Gavin Newsom is panicking. He's looking to find
a buyer for the refinery up in northern California. And
we'll do more on that tomorrow because that's going to
be highly entertaining. Now he's panicking often lately, I've been
telling you about something that should have been covered in
(23:59):
great detail al and spelled. It would has spared a
lot of people a lot of heartache. Karen Bass was
a committed communist back in her younger days, going back
to the nineteen seventies, when she was in her twenties,
and she used to go with this, with this then
Samos Brigade, I think, is how you pronounce it, And
(24:23):
they go to Cuba. And she went to Cuba eight
times with this group, and then she afterwards, after she
left the group, she went many more times.
Speaker 1 (24:33):
And she was completely.
Speaker 2 (24:34):
Enamored with the communist system in Cuba, and really enamored
with Fidel Castro. Thought he was just so dynamic and charismatic.
This is all I had newspapers on that time. The
story popped up today what Cuba is like for some people.
(24:55):
In fact, you read the first three paragraphs of this story,
it's from Yahoo News, and it's hard to tell if
this is a story out of Havana or Los Angeles.
Talks about a man named William Aybell. William. There's a
photo of him looking inside a plastic bag that he
dug out of a trash can. He was scrounging for
his meal, and what he got out of the trash
(25:17):
can was rice, vegetables, a chicken bone with no chicken
meat on it, and flies. So he pulls out a
meatless chicken bone with flies, rice and vegetables. Sixty two
years old. He's been sleeping on the streets since his
house collapsed, and that happens a lot in Havana.
Speaker 1 (25:38):
No, this is not Los Angeles.
Speaker 2 (25:39):
This is Havana because of the dilapidation of many buildings.
The economy is in ruins. That house is a symbol
of the economy. Food is the hardest part. I've been
rummaging through trash cans for two years to eat. It's hard.
It's hard to understand him, Corney of the reporter, because
he has many missing teeth. Where's a grimy t shirt.
(26:03):
Abel's body is a skeletal He admits he used to
drink quite a lot. He would be at home here
in La But this is what communist governments and communist
economics bring you. Abel is one of a group of
visibly growing beggars and homeless people in a country with
(26:24):
its worst economic crisis in three decades. The Labor and
Social Security Minister resigned in Cuba. She claimed there are
no beggars in the communist state. It's you know, it's
it's it's socialism. It's communism. Food prices of skyrocketed five
(26:44):
hundred percent in Cuba. The word poor is never used
in official communications. They call it vulnerable people. That's what
left wing people do, is they they invent a new
language to cover up all the atrocities that their policies cause.
There's another guy, one de la Cruz. He sat on
(27:06):
the street with a piece of cardboard that said, please
something to eat. The social security. The social security that
they get down there amounts to less than three dollars
a month. God, you can't even buy a small amount
(27:27):
of chicken. And even if you go to the soup kitchen,
the food is bad. You get rice without butter, without oil.
He sleeps in a very small room, but it's completely empty,
and one in ten Cuban children live in severe child
food poverty. They want to elect a socialist communist in
(27:49):
New York City who wants the government to run the
grocery stores. We have a socialist communist running Los Angeles.
There's also one running in Chicago. We have a massive
amount of homelessness and poverty, drug addicts, and mental patients
in the streets. By the way, I went to Hollywood
last night to go see a play. Oh my god.
I don't know what all the tourists must think when
(28:11):
they go on their dream vacation with their family. A
lot of wives and husbands and their kids with them,
and woof walking down Hollywood Boulevard and all these crazy
people shouting into the air, garbage everywhere.
Speaker 1 (28:29):
And I'm looking around.
Speaker 2 (28:30):
It's like, why would you allow this area that gets
millions of tourists to be filled with garbage and dangerous,
insane people. But you know, you have a mayor who
is politically formed by her experiences in Cuba. You read
(28:52):
that story and just cross that Havana and put in
Los Angeles makes perfect sense. Michael Krauzer is the News
Way is next. Michael's Live in the CAFI twenty four
hour Newsroom. Hey, you've been listening to the John Cobalt
Show podcast. You can always hear the show live on
KFI Am six forty from one to four pm every
Monday through Friday, and of course anytime on demand on
(29:13):
the iHeartRadio app.
The John Kobylt Show News
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John Kobylt
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