At $6.09 a Gallon, LA Pays Record Gasoline Price Over US Average




  • In World
  • 2022-05-25 13:00:00Z
  • By Bloomberg
 

(Bloomberg) -- Los Angeles drivers know they pay more for gasoline than the average US driver: It's the price for cleaner air in a state that's made being green part of its DNA.

Most Read from Bloomberg

  • Biden Demands US 'Stand Up' to Gun Makers After Texas Attack

  • Plot to Kill George W. Bush in Revenge for Iraq War Was Foiled, FBI Says

  • Fed Saw Aggressive Hikes Providing Flexibility Later This Year

  • Texas Shooter Kills 18 Elementary School Children, One Teacher

  • Why So Few Big Rats Have Fled Putin's Ship

What motorists in LA -- a city famed for its car culture -- may not realize is that the amount they pay over the national average soared to more than $1.80 a gallon in late March, the widest in at least 10 years, according to data from the AAA.

So far, at least, the cash squeeze at the pump isn't crimping travel plans, even though each tank costs about $24 more. The Auto Club of Southern California predicts 2.6 million local residents will take to the highways this Memorial Day weekend. That's up 5% from 2021 but about 7% below 2019, before the Covid-19 pandemic.

The cause for the spike in prices earlier this year was refinery outages, according to Patrick De Haan, head of petroleum analysis at GasBuddy, which tracks prices at 150,000 US gas stations.

While the local refinery issues have largely been resolved, prices nationally have kept on climbing. Regular gasoline rose to $6.09 a gallon in LA this week, according to the AAA, still almost $1.50 more than the national average of around $4.60.

The higher prices in California are partly the result of taxes and state programs to reduce greenhouse gases, like a rule requiring a less-polluting blend of fuel. These measures add about $1.30 to the cost of a gallon, according to the Western States Petroleum Association, a trade group.

California also imports both oil and refined products, which must be trucked in or brought by tanker.

"We don't have pipelines coming in from Texas and other parts of the country," said Kevin Slagle, a spokesman for the oil group. "We have to ship it in from around the world."

Prices, including the extra amount LA drivers pay, could spike again in the summer when travel picks up and a planned increase in the state tax is due to take effect. At the same time, a Chevron Corp. refinery in the state is scheduled for maintenance, and a South Korean refinery that supplies the US West Coast had some units offline after a fire.

To offer drivers some relief, Governor Gavin Newsom, a Democrat who's running for re-election this year, has proposed an $11 billion package that includes $400 refunds to personal car and truck owners, with a maximum of $800 for up to two vehicles.

A "very significant factor is simply the increased cost of everything in California," said Doug Shupe, an Auto Club spokesman. "That includes labor, electricity and other energy sources, and a myriad of other factors that are more amorphous, like increased business litigation expenses. All of these factor into higher prices in California for just about everything."

Most Read from Bloomberg Businessweek

  • Mark Zuckerberg Is Blowing Up Instagram to Try and Catch TikTok

  • Elon Musk's 420-Degree Edgelord Pivot Is Getting Stale

  • Deadly Heat in India Is a Warning of Global Catastrophes to Come

  • The Thrill of Better Office Wi-Fi

  • Open With Care: That Next Power Bill Could Shock You

©2022 Bloomberg L.P.

COMMENTS

More Related News

G-7 Latest: Leaders Promote Idea of Price Caps on Russian Energy
G-7 Latest: Leaders Promote Idea of Price Caps on Russian Energy

(Bloomberg) -- Group of Seven leaders agreed that they want ministers to urgently look into how prices of Russian oil and gas can be curbed to limit revenues...

China
China's Shock Covid Shift Adds Fuel to World-Beating Stock Rally

(Bloomberg) -- Chinese shares rallied ever closer to a bull market after Beijing unexpectedly halved the mandatory quarantine period, marking a key shift...

China
China's Xi to Visit Hong Kong for July 1 Anniversary, Police Say
  • World
  • 2022-06-28 09:29:45Z

(Bloomberg) -- Hong Kong confirmed President Xi Jinping will attend events marking the 25th anniversary of Chinese rule in person, ending weeks of...

G-7 Latest: Leaders Want Urgent Evaluation of Energy Price Caps
G-7 Latest: Leaders Want Urgent Evaluation of Energy Price Caps

(Bloomberg) -- Group of Seven leaders agreed that they want ministers to urgently discuss and evaluate how the prices of Russian oil and gas can be curbed to...

Tencent Leads China Tech Losses as Major Backer Plans to Cut Its Stake
Tencent Leads China Tech Losses as Major Backer Plans to Cut Its Stake

(Bloomberg) -- Chinese technology stocks fell as a plan by Tencent Holdings Ltd.'s major backer to further cut its stake in the company fueled concerns more ...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply

Comments

Top News: World