Fuel costs at California gas stations are climbing, and there’s a chance they’ll keep going up.
As of September 27, the American Automobile Association reports that California’s statewide average gasoline price stands at $5.89 per gallon, notably higher than the national average of $3.83 per gallon.
Patrick De Haan, Gas Buddy’s head of petroleum analysis, suggests that gas price increases in California could potentially be curbed if Governor Gavin Newsom intervenes with a waiver. Without such intervention, prices may surge by 15 to 35 cents per gallon in the coming weeks.
What is the current situation regarding gasoline prices in California?
According to Gokce Soydemir, Foster Farms endowed professor of business economics at California State University, Stanislaus, the combination of supply cuts by OPEC+ and Russia is expected to keep oil prices elevated until the end of 2023. Additionally, refinery outages, partly caused by Tropical Storm Hilary’s heavy rainfall in Southern California, have contributed to the price increase.
Refineries in Torrance, El Segundo, and Los Angeles, which serve the southern market, faced challenges recovering from these outages and scheduled maintenance. As a result, gasoline supply remains tight in Southern California, leading to rising prices. This scarcity has prompted refineries in Northern California to send gasoline southward, causing prices to potentially rise in Northern California and the Pacific Northwest as well.