Across the board, gas prices have been slowly dropping caused primarily by a sluggish demand for all the available gasoline. The average for gas was $2.588 a gallon which was down 2.5 cents from last week’s weekly survey. The lowest state on the map was Texas which was at $2.404 on average for the past week. So, many Americans are obviously pleased with this.
Gas prices are dropping except for California.
For California, though, they have seen an increase in the cost for gas, the report coming a day after the holiday weekend. The price for gas rose 6.2 cents to rest at $3.099 a gallon. California is used to high gas prices, but when the economy is rough, no one wants to spend forty dollars to fill their car.
The primary cause for the increase in gas price is due to the fact that Californian gas has to be much cleaner. In regards to the cleanliness, it is cleaner than any other state’s gas. Because of this, though, there are not nearly as many refineries that pump out this extra clean gas which causes a decrease in supply.
Furthermore, two refineries in Northern California are closed for maintenance, so the refineries that are there are forced to work even harder to try and get their output up. Analysts are suggesting that, because there are fewer refineries working, and the ones that are working are trimming some production to keep profits high, that gas prices in California might go up as high as $3.25.
There are people obviously concerned and frustrated about this. Complaints about the tremendously high fuel taxes (highest in the Union) make Californians even more distasteful about the prices. Finally, because it costs anywhere from 5-15 cents more a gallon to refine this extra clean gasoline, the prices fall on the consumer.
Because the state is down to only 13 refineries creating this extra clean gasoline, there is going to be a major issue of supply not meeting demand. If that happens, prices are expected to rise even more.