Gas prices have surged in California in recent weeks as the state’s supply is limited due to recent reductions in refining capacity.
Gas prices rose 40 cents in about two weeks, while the average gas price rose across the state California at $4.58 per gallon – up from $4.46 the week before and $4.18 two weeks before that, according to AAA data.
These figures are well above the national average of $2.92 per gallon. California gas prices are the highest of any state, at $4.37 per gallon in Hawaii, $4.15 per gallon in Washington and $3.68 per gallon in Oregon.
Rising gas prices in California are due to a reduction in oil refining capacity due to the suspension of operations at Valero’s Benicia refinery, as well as the earlier closure of the Phillips 66 refinery in Los Angeles.
GAS PRICES FALL IN JANUARY, GIVING AMERICANS A BREAK AT THE PUMP
The Phillips 66 Wilmington refinery near Los Angeles was previously closed. (Mario Tama/Getty Images)
The closure of the Benicia refinery, located in Northern California, leaves six operating refineries in the state, which is the largest fuel consumer of all states except Texas.
Two others are in the Bay Area, including Chevron’s refinery in Richmond and PBF Energy’s Martinez refinery. The other four are in Southern California: Marathon’s Los Angeles refinery, Chevron’s El Segundo refinery, PBF Energy’s Torrance refinery and Valero’s Wilmington refinery.
The tightening refining supply prompted the California Senate Republican caucus to write a letter to Democratic Gov. Gavin Newsom calling for a special session to address the worsening “cost and supply crisis” created by state policies targeting the oil and gas industry.
CALIFORNIA ‘TRULY AT A BREAKING POINT,’ STATE SENATOR SAYS AS REFINERIES SHUT DOWN AND GAS PRICES RISE
Valero’s Benicia refinery is expected to close, reducing refining capacity in the state of California. (Paul Morris/Bloomberg)
“It’s not theoretical, this is happening now. And the longer we wait to address this problem, the more instability and volatility we will see here in California,” she added.
TRUMP CONSIDERS LIMITING STATE GAS TAX, SIGNALS POSSIBLE RELIEF FOR CALIFORNIA
Big Money Show panelists discuss California energy policy and its impact on gas prices and the oil industry.
For the country as a whole, gas prices have fallen over the past year, according to the latest figures consumer price index (CPI) data from the Bureau of Labor Statistics.
The BLS’ January CPI Inflation Report showed that gas prices have fallen 7.5% over the past year and prices have fallen 3.2% from the previous month.
National energy prices have remained largely flat over the past year, with the CPI leading the energy index down 0.1%.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
The decline in gas prices has been somewhat offset by rising prices for electricity and gas services, which have risen by 6.3% and 9.8% respectively over the past year.
