As the weather heats up and Southern California drivers head to the pump this month, they may get sticker shock once again.
Last month, the average price of a gallon of unleaded gas was $5.45 in California compared to a month prior when the statewide average was around $4.90, according to AAA. And California’s prices remain high compared to the national average of $3.67 per gallon.
There are several factors causing this disparity, but according to Patrick De Haan, head of petroleum analysis at GasBuddy, the price hike is mostly due to refinery maintenance and the switch to a summer blend of gasoline.
“California is relatively on its own when it comes to gasoline supply because it has its own blend of CARB-mandated fuel, whereas the rest of the country defaults to the EPA,” De Haan explains. “The problem right now with California is the supply of CARB-mandated gasoline has been plummeting down 27 percent in the last four weeks. That is attention-grabbing.”
The California Reformulated Gasoline (CARB) program is responsible for “setting standards for California gasoline to produce cost-effective emission reductions.”
Maintenance is now being conducted at oil refineries which is typically done ahead of the summer season to keep up with increased demand during those months.
However, De Haan explained that efforts focused on summer maintenance will mean facilities will have less capability to produce gasoline at normal rates.
“California has a major impact on prices throughout the Pacific Northwest and the West Coast because it has a high number of refineries and supplies gas to much of that region,” he said.
Since refineries are outdoors and exposed to the elements, the constant weathering can take a toll. Pipes, which comprise a huge portion of refineries, must be checked as hot liquids such as crude oil which can result in thinning over time.
“In fact, that’s how some of the catastrophic damage at refineries has happened in the past where pipes that are thin are not replaced so, not only do oil companies have to routinely check the integrity of the pipelines that make up their facilities, but they also have to do maintenance and upgrades,” De Haan said.
Environmental regulators require that gasoline sold in the summer be less susceptible to evaporation. That requires refiners to replace evaporative gas components with those containing the opposite characteristics which can be more expensive, according to the U.S. Energy Information Administration.
However, relief for drivers may be in sight by the time summer arrives.
“I’m optimistic that, though prices may go up between now and Memorial Day, once we get into the end of June, prices should start to fall again as supplies of the summer blend of gasoline increase,” De Haan said.
Average gas prices by the second half of summer could potentially fall back below the $5 per gallon mark in California.
However, De Haan notes there are still several more weeks of maintenance to be done in California before drivers could see that relief.
Tensions in the Middle East as well as Ukraine have not appeared to help either, as the oil industry as a whole watches for developments it may need to further pivot from.
Quick Stats From April
The nation’s top 10 least expensive markets: Mississippi ($3.11), Colorado ($3.16), Louisiana ($3.18), Oklahoma ($3.22), Arkansas ($3.23), New Mexico ($3.26), Tennesee ($3.26), Kansas ($3.26), Alabama ($3.27), and South Carolina ($3.27).
The nation’s top 10 most expensive markets: California ($5.45), Hawaii ($4.78), Washington ($4.67), Nevada ($4.63), Oregon ($4.44), Alaska ($4.37), Arizona ($3.13), Utah ($3.96), Illinois ($3.96), and Idaho, ($3.93).
