According to AAA, California consistently experiences some of the highest gas prices in the United States. As of Thursday, the national average for a gallon of regular unleaded gas was $3.40, while in California, the average was significantly higher at $4.87, the highest in the country.
Factors Influencing Gas Prices
The price of gasoline is influenced by several factors, including refining costs, taxes, distribution and marketing expenses, and crude oil prices, as outlined by the U.S. Energy Information Administration (EIA).
High Taxes: California has the highest gasoline taxes in the nation, which significantly contributes to the higher prices at the pump. However, high taxes are not the only factor at play.
The Unique Challenges of California’s Gas Market
Special Fuel Blend: California mandates a special blend of gasoline designed to reduce pollution. This cleaner-burning fuel is more expensive to produce.
βCalifornia also has seen a drop of 66% in the amount of refineries in operation from where we were 40 years ago,β said Patrick De Haan, head of petroleum analysis for GasBuddy. With fewer refineries producing this specialized gasoline, supply constraints are more likely.
Isolated Refinery Market: California’s market for refined gasoline is relatively isolated. The California Energy Commission reports that only 11 major refineries within the state produce the special fuel blend required. Because few other states use this blend, any refinery outages can lead to significant price volatility.
Anlleyn Venegas, a senior public affairs specialist at AAA, explained to CNBC that California’s unique fuel blend limits its supply options when there are disruptions at the refineries.
βPart of the reason why prices have been so high is that California has really restricted the ability for refineries to expand and grow,β said De Haan. Efforts to transition California to more electric vehicles have led to a challenging environment for refinery expansions or oil industry investments.
The Push for Cleaner Vehicles
California plans to ban the sale of new gas-powered cars by 2035 as it transitions to cleaner vehicles. In 2023, a quarter of new cars sold in the state were zero-emission vehicles, according to the California Energy Commission.
βThe high price of gasoline does encourage more EV adoption,β De Haan noted. βAmericans getting hit with $5 and $6 [per] gallon prices in California is likely accelerating the shift away from traditional gas-powered vehicles.β
Legislative Efforts to Combat High Prices
In 2023, California Governor Gavin Newsom signed a new law aimed at combating alleged price gouging at the pump. This law seeks to increase transparency in the oil and gas industry and established an independent watchdog, the Division of Petroleum Market Oversight.
βThere hasnβt really been much impact,β De Haan said of the new law. βBut I do believe that in the months ahead, there probably will be more … talk on this subject.β
Tips for Reducing Fuel Costs
Given the high cost of gasoline, families are spending significant amounts on fuel. In 2022, the average annual spending per consumer unit on gasoline and other fuels was $3,120, according to the Bureau of Labor Statistics. This represents a 45.3% increase from 2021, as more people resumed commuting post-pandemic and fuel prices rose.
Anlleyn Venegas of AAA suggests that adopting new and improved driving behaviors can lead to significant savings. For those who aren’t switching to electric vehicles, here are some ways to save on gas:
Shop Around for the Lowest Price: Use apps or websites to find the cheapest gas in your area.
Keep Up with Vehicle Maintenance: Regular maintenance can improve your carβs fuel efficiency.
Plan Your Route Before You Go: Efficient route planning can help you avoid unnecessary driving.
Slow Down and Drive the Speed Limit: Driving at a steady pace and within speed limits can save fuel.
Donβt Drive Aggressively: Aggressive driving habits, like rapid acceleration and hard braking, consume more gas.
By understanding the factors behind Californiaβs high gas prices and adopting smart driving habits, residents can better manage their fuel expenses.
Matt Pinner is a dedicated journalist for WVPrepBB.com, specializing in USA and crime news. With a keen eye for detail and a passion for uncovering the truth, Matt brings timely and insightful reporting to his readers. His work on WVPrepBB.com keeps the community informed and engaged with the latest developments in national news and criminal justice.
