Crude oil prices are rising, surging $4 a barrel last week. Oil inventories are way down. Weve just switched anew to the states specialized, environmentally stringent blend of summer gas. And, oh yeah, theres that new tax on gas to pay for California roads.
So, no, it shouldnt surprise us that Southern Californias gas prices have hit their highest level since the summer of 2015. But it still stings.
On Wednesday the average price for a gallon of self-serve regular in Los Angeles County was $3.56, the highest since Aug. 31, 2015, according to the Automobile Club of Southern California. Prices in L.A. County have risen or held steady for 23 consecutive days.
Is the surge going to ease any time soon? Dont bet on it. Those variables listed above – and production issues both international and local – could keep the pressure on in the months ahead.
Steady price increases[hhmc]
Its not just L.A. County:
- Orange County prices have also risen or remained flat for 23 consecutive days, topping out Wednesday at $3.51 a gallon. That was the highest level since August 30, 2015.
- San Bernardino Countys average price hit $3.43 a gallon after a run-up of 14 consecutive days.
- Riverside County prices rose or held steady for 16 days before hitting $3.47 a gallon Wednesday. Same story: Those were also the highest prices the Inland Empire has seen since the summer of 2015.
Oil inventories are down[hhmc]
Patrick Dehaan, a senior petroleum analyst with GasBuddy.com, linked much of the surge in prices to dwindling oil inventories.
“U.S. commercial oil inventories are down 100 million barrels from a year ago, and crude oil prices rose $4 a barrel last week,” he said. “When you combine that with Californias latest 12 cent gas tax and the switchover by refineries to the summer blend of gas, things really start to ramp up.”
Southern California is always the first region in the nation to transition to a summer blend of gas, DeHaan said. That widens an already-big price gap between the Southland and other parts of the country, but that gap will narrow in the coming weeks as other regions do their own conversions.
“Refineries in Southern California must have their switchover completed by April 1,” DeHaan said. “Theres always a lull in demand in February and into March and thats when the refineries do their maintenance, so that leads to higher prices. As their production comes back online that will lower prices a bit. But it still may be three to four weeks before we see the effect.”
Figures from the California Energy Commission show that the Golden States supply of specially formulated summer gas is in good shape. For the week ended March 16 (the most recent period for which data is available) there were more than 7.9 million barrels in stock compared with about 5.6 million barrels a year earlier.
Refinery production is also up. For the same week, production of the summer blend stood at more than 6.8 million barrels compared with about 5.8 million barrels during the same week last year.
Some stations are priced really high[hhmc]
Still, prices at some Southland stations are running well above average.
On Wednesday a Union 76 station at 3275 E. Foothill Blvd. in Pasadena was selling regular for a whopping $4.39 a gallon, while two other Mobil stations in Los Angeles and Studio City priced it at $4.29 a gallon. A host of other locations in Pomona, Culver City, Glendale and Beverly Hills were priced at $4.19 a gallon.
A Shell station at 2331 E. Katella Ave. in Anaheim had the highest Orange County price on Wednesday at $3.93 a gallon, but another Shell at 28922 Golden Lantern St. in Laguna Niguel was close behind at $3.89 a gallon.
Tina Khawji, who manages Tinas Flowers & Gifts in Woodland Hills, said her floral shop sometimes makes up to 50 deliveries a week. Rising gas prices have an effect, she said, but business goes on.
“It doesnt stop us,” she said. “We have no choice … we have to serve our customers.”
Looking ahead[hhmc]
There are several variables that could hike prices in the coming months, according to DeHaan.
Related Articles
- Gas prices rise to highest since 2015 in Southern California
- Here are the top money-wasting habits when buying gas, are you guilty of any of them?
“Venezuela is a member of OPEC and they have one of the biggest oil reserves, but they are exporting the least amount of oil they have since the 1980s,” he said. “OPEC has made big production cuts and we also have the issue of whether President Trump will put sanctions on Iran. They produce a significant amount of crude oil.”
U.S. refiners are taking less OPEC-produced oil than ever before as the groups members continue trimming their output. Weekly crude imports from seven OPEC members fell 14 percent last week to 1.86 million barrels per day. Thats the lowest level since the Energy Information Administration began collecting weekly data in 2010.
“Those are the things to keep an eye on,” DeHaan said. “The seasonal things … we see that every year. A bigger issue for California would be if there were more problems with the PBF Energy-owned refinery in Torrance.That could boost gas prices by 10 to 12 cents.”
That facility, formerly owned by ExxonMobil, has had numerous problems over the years, including a Feb. 18, 2015 explosion in a gasoline processing unit that led to two workers suffering minor injuries and debris being dispersed into the surrounding community.
[contf] [contfnew] 
daily news
[contfnewc] [contfnewc]
