California Gasoline Prices Hit Record High as Crude Oil Soars
(Bloomberg) -- California gasoline prices have never been higher, posing fresh challenges for U.S. President Joe Biden who less than a week ago vowed to “work like the devil” to alleviate pain at the pump for consumers.
Average retail prices for regular gasoline in the Golden State rose to $4.719 per gallon on Wednesday, topping the previous record of $4.713 per gallon reached on Nov. 27, according to AAA. That’s more than a dollar higher than the national average, which is currently $3.514 per gallon, the most expensive since July 2014.
High pump prices, often a result of gains in crude oil, have become a liability for the Biden administration as the president tries to tackle decades-high inflation rates. Oil released from the Strategic Petroleum Reserve since November have failed to hold back a steady increase in pump prices even in the middle of the winter low-demand season. Meanwhile, West Texas Intermediate surged above $95 per barrel on Monday for the first time since 2014 as geopolitical tensions escalated amid low global supply.
California is leading gasoline price gains in the country for several reasons. State regulators require a boutique, cleaner-burning grade of fuel that only California refiners and a small handful of international producers can make. The state is also cut off from fuel supplies in the rest of the country by the Rocky Mountains, and prices there are more prone to spikes during supply disruptions.
But high prices at the pump are unlikely to deter people from driving, whether it’s commuting for work or driving for leisure, says Doug Shupe of AAA California. Traveling by car is still the cheapest mode of transportation, and “people need to get where they need to be,” he said.
©2022 Bloomberg L.P.