Bottom Line Up Front: West Coast refinery closures, climate regulations, and proposed new pipeline capacity are tightening fuel supply and changing the cost to bring fuels to market. Stillwater’s Supply & Demand Outlook answers how much product the region will have. Our new Price & Margin Outlook answers the next question: At what price, and at what refining margin? Together, under the West Coast Fuels Outlooks banner, they give fuel suppliers, investors, and traders a basis to make strategic decisions throughout PADD 5.1
A refinery manager once told me that working in energy on the West Coast can feel like playing football in the rain. The conditions are constantly shifting: strict and ever-changing environmental policy, refineries shutting down (Valero Benicia, P66 Wilmington), and now new capacity (Western Gateway Pipeline) may be coming online. But like playing football in the rain… in the end someone’s going to win.
If you want to win, you need to understand this market. If you want to understand this market, you need a good forecast from the people who know it best.
Our readers already know how Stillwater tracks the volume side of the game through our Supply & Demand Outlook, but that’s just the start. Product prices and refining margins change along with product balances, and we forecast those, too.
Balances tell you how much. Prices & margins tell you what it costs.
Stillwater’s PADD 5 Supply & Demand Outlook forecasts gasoline, jet, and diesel balances across four enclaves: Southern California, Northern California, the Pacific Northwest (PNW), and the inland desert markets in Arizona and Nevada. This outlook provides numerical balances by product and tells you whether a market is long or short transportation fuels, and how those products flow between the Coastal refineries, pipelines, and waterborne imports.
Stillwater’s Price & Margin Outlook picks up where the balances leave off. It translates those supply and demand conditions into forecast prices by product and market. When the Supply & Demand Outlook says Southern California tips from balanced to short, the Price & Margin Outlook forecasts the impact to prices of gasoline, jet and diesel, and to the crude-to-products margin for the refineries.
These two outlooks work in tandem to give you an overall view of the market, so you’re not just watching the market, but positioned to win.
West Coast indicator margins provide a broad market view
Product margins can move independently, but the simplest, highest-level read on refining economics is an indicator margin: a crack-spread-style measure that summarizes the gross margin from turning a barrel of crude into finished products. We use a 4-2-1-1 margin to represent 4 barrels of crude refined to 2 barrels of gasoline, 1 barrel of jet, and 1 barrel of diesel, expressed per barrel of crude.
The 4-2-1-1 is not a substitute for the full price forecast, which breaks out gasoline, jet, and diesel prices by market, but it’s a fast, credible signal of where refining economics are headed and the clearest way to see what Stillwater’s full West Coast Fuels Outlooks can do.
The chart below shows our indicator margin forecast for the Los Angeles market across three scenarios, indexed so that the 2030 margin at which refineries earn a 10% return on capital employed (ROCE) equals 100. The chart shows index values rather than absolute margins (the full price and margin levels are available via Stillwater’s West Coast Fuels Outlook).
Los Angeles Refining Indicator Margin (4-2-1-1) 
Note: 2030 10% Refinery ROCE = 100
Our 4-2-1-1 view moves with the decisions refiners, regulators, traders, and pipelines make, tuned to the supply and demand outlook for each product.
The full Price & Margin Outlook goes further: absolute prices and margins for each product, in every major West Coast market plus the inland desert markets of Arizona and Nevada. Think of it this way: The broad view tells you where the markets are headed, the full Outlook gives you the level of insight you can act on.
Grounded in market mechanics, tuned to the historical record
A forecast is only as good as its grounding. We develop the Price & Margin Outlook on physical market mechanics: the cost to move product between regions, the conditions under which a market prices off imports versus exports, and how those shift as balances change.
We take this a step further and test those mechanisms against the historical record, tuning the model to match supply and demand conditions that actually occurred on the West Coast, such as planned and unplanned refinery outages, seasonal shifts in demand, sustained import or export flows, and global disruptions to energy markets.
Scenarios that matter now
We run our model across different market conditions and scenario cases, which is where it earns its keep for anyone weighing an investment or a trade. These are the scenarios our clients are asking us to help them get ahead of:
- Import versus export parity. With no pipelines to other markets, the West Coast operates as an energy island. How and when does it shift among import, export, and balanced conditions for gasoline, jet, and diesel?
- Refinery rationalization and reliability. When the next refinery closes (or trips offline without warning), what happens to prices and margins?
- New pipeline capacity. Western Gateway and similar projects promise to connect PADD 2 and 3 supply to California, Arizona, and Nevada. Does that raise prices, lower them, or just move the bottleneck?
- Gasoline grade differentials. CARBOB, RBOB, CBOB, AZRBOB. The West Coast’s patchwork of required grades means “the price of gasoline” is really several different answers. Stillwater’s model prices each separately.
- Seasonal variation. Product specs and demand shift with the seasons. Our model forecasts how those shifts impact prices.
- Sensitivity testing. Want to stress test your own views against the assumptions that matter most? Sensitivity and probability testing is available as an add-on.
The West Coast Fuels Outlooks
The Supply & Demand Outlook and the Price & Margin Outlook are offered together as the West Coast Fuels Outlooks, and each is available on its own. Both are consulting deliverables rather than self-serve subscriptions, most often delivered as part of, or alongside, a larger engagement. Clients get forecast outputs and analysis tailored to a defined set of assumptions and supply scenarios. As market conditions and inputs change, the same engine produces a fresh view, which is why the Outlooks support ongoing and repeat work, not just a one-time read.
The Price & Margin Outlook covers gasoline, jet, and diesel prices for Los Angeles, San Francisco, and the Pacific Northwest, plus desert markets such as Las Vegas, Phoenix, and Reno. The off-the-shelf Outlook includes two scenarios, the Base Case and a Western Gateway Pipeline case. Additional scenarios and sensitivities can be scoped as an add-on consulting engagement.
In Summary: Knowing whether the West Coast will be long or short product is half the picture. Knowing what that means for prices and margins is the other half. The conditions on the West Coast aren’t going to get any easier, but if you are weighing an investment, acquisition, or position in this market, Stillwater’s West Coast Fuels Outlooks were built to make your decision-making simpler. Explore the full suite on our West Coast Fuels Outlooks page or contact us to learn more!
See where West Coast fuel markets are headed.
Stillwater’s West Coast Fuels Outlooks provide forward-looking analysis of regional supply and demand, fuel prices, and refining margins to support strategic decisions across PADD 5.