Gas Costs In California Are Rising. Why And How High They Could Go

California is one of several states where refinery issues have stifled supplies and prompted local increases large enough to reverse an extended fall in the national average gas price, which has led to the price of gasoline increasing once again.

Using statistics from the American Automobile Association, we can see that the average price of a gallon of regular gas in California on Tuesday was $5.88, up 9 cents from the previous day and 43 cents from a week ago. This is more than $2 higher than the national average price.

Gas Costs In California Are Rising. Why And How High They Could Go
Gas Costs In California Are Rising. Why And How High They Could Go

Analysts predict that California gas prices will keep climbing for the next few weeks, potentially by another 75 cents per gallon.

Severin Borenstein, an economist and academic head of the Energy Institute at Haas at UC Berkeley, has stated that the cause of the recent surge in prices in California is distinct from the explanation of the record-high expenses that drivers faced earlier this year.

The Russian invasion of Ukraine in February caused oil prices to spike from $90 per barrel to well over $100. Oil prices, however, have been falling gradually over the past few months as worries over a worldwide economic slowdown have taken hold.

However, this time around in California, higher gas costs are due to issues at local refineries. GasBuddy analyst Patrick De Haan said on Monday that similar outages at refineries in the Pacific Northwest, Great Lakes, and Plains had caused prices to spike there as well.

According to AAA, gas costs in the Bay Area and Northern California are among the highest in the state.

According to Borenstein, “the rise this time is due to a shortfall of refined gasoline” because of routine maintenance and unscheduled downtime at local refineries.

Borenstein and others have pointed out that California has the highest gas costs in the country because of the state’s high gas taxes and other fees, such as those for pollution control and vehicle registration.

As the commodity price of gasoline remains high, Borenstein predicts that the retail price will also be high for at least the next two weeks. “It’s hard to know what lies beyond that.”

Nicole Peterson, a spokesperson for GasBuddy, said that prices have continued to fall in some regions, including the Northeast and the South.

De Haan noted that the national average price of gasoline increased by 3.2 cents from the previous week to $3.67 per gallon on Monday, down 17.5 cents from a month ago but still 49.3 cents higher than this time a year ago. This marked the end of a 14-week streak of declining gas prices across the country.

I don’t think I’ve ever seen such a wide range of price behaviors from coast to coast in my whole time, he said.

Peterson predicted that the disparity between the areas would widen as California’s refineries worked to bring their problems under control.

And it’s unlikely that drivers in the state will get a break anytime soon. A lot of people think prices are going to keep going up for the next two weeks, or at least until the refinery problems get fixed.

Peterson predicted a price increase of 25 cents to 75 cents per gallon across the state of California.

Scroll to Top