California gas prices could jump 15 to 35 cents per gallon soon, expert says. Here’s why

Gas prices at California pumps are on the rise, and there is a possibility that prices will continue to increase.

California’s statewide average is $5.89 per gallon as of Sept. 27, according to the American Automobile Association, while the national average is a few dollars below at $3.83 per gallon.

While Sacramento County’s average is slightly below the statewide mark at $5.64 per gallon, most of Southern California has already eclipsed the $6 mark. Mono County leads the state at $6.60 per gallon.

Gas price increases might be stemmed in Gov. Gavin Newsom steps in to issue a waiver, said Patrick De Haan, head of petroleum analysis for Gas Buddy. Otherwise, prices could jump 15 to 35 cents per gallon over the next few weeks.

What’s going on with gasoline prices in California?

“Supply cuts by OPEC+ (Organization of the Petroleum Exporting Countries) and a cut from Russia have pushed prices up and are likely to stay high until end of 2023,” wrote Gokce Soydemir, Foster Farms endowed professor of business economic at California State University, Stanislaus, in an email to The Sacramento Bee.

He also added that “a series of refinery outages also had an effect” on the price increase.

Tropical Storm Hilary dropped more than a foot of rain on some parts of Southern California this summer, shattering rainfall records. Refineries in Torrance, El Segundo and Los Angeles, which serve the southern market, experienced issues due to the storm and also had scheduled maintenance planned, De Haan said.

Since then, the refineries have had “a rough go” trying to get back online, De Haan said.

“There’s still a struggle for gasoline supply in Southern California,” he said.

“Which is pushing the price up, which is in turn then drawing attention from refineries in Northern California, which are sending gasoline to the south. And that’s why prices now are likely to start going up in Northern California and the Pacific Northwest.”

What will help lower gasoline costs?

There is a chance that consumers’ wallets won’t suffer for too long — if California switches to a different kind of gasoline.

Northern California usually switches to winter-grade gasoline around Oct. 1 and Southern California usually makes the switch around Nov. 1, De Haan said.

The winter-grade blend contains more butane and has a “rating slightly below premium gasoline” of 91 to 93 octane, according to the U.S. Energy Information Administration. Butane makes the gasoline less expensive to produce, but its high volatility limits the amount that can be used in the summer blend.

Over the 2022 winter months, Newsom issued waivers that allowed for winter-grade gasoline to be sold at pumps.

“When he issued waivers last year, the wholesale cost of gasoline fell by over $1 a gallon within 48 hours,” De Haan said.

If Newsom allows retailers and refiners to sell winter-grade gasoline again this year, “price increases may not be dramatic or nearly as significant,” De Haan said.

McClatchyDC’s David Lightman contributed to this story.

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