Los Angeles Tops US Average Gas Costs After City Prices Surpass $6 Per Gallon

While only 16 states in the nation have recorded gas prices under $4 per gallon, (those include Kansas $3.76, Missouri $3.77, Oklahoma $3.77, and Maryland $3.81) the average price of gas in the United States reached $4.33 per gallon on March 11, but since then has dropped some 9 cents. However, prices refuse to come down for those in California.

On Tuesday, the average cost of gas per gallon reached $6.01 in Los Angeles, the highest number in the nation. Surrounding counties in the Golden State include costs of $5.97 in Orange County, $5.95 in Ventura County, and $5.90 in Bernardino County. The average for the rest of the state comes to $5.86 per gallon.

Industry watchers suggest that the drastic spike is due to flaring at PBF Energy refineries located in Torrance, Martinez, and Valero outside of San Francisco. Flaring is a safety device used by refineries to prevent “overpressure” of equipment. Planned flaring is scheduled, but unplanned flaring is used for emergencies caused by equipment failure or other unexpected events.

According to Patrick De Haan, head analyst at GasBuddy, the California refineries could be experiencing computer or valve issues which have caused them to use flaring as a safety solution, but that is reportedly just a guess, as refineries do not willingly release that kind of information.

Even if refineries in California get their safety issues under control, De Haan says it’s not certain that will bring the costs of gas down, considering other global issues such as the ongoing conflict in Ukraine and the COVID-19 pandemic.

California is also known to have higher gas costs on average, considering their strict environmental laws and taxes on motor fuels as a means of curbing CO2 emissions and protecting the environment as humanity continues to avoid addressing its climate crisis.

A decrease in California’s gas supply would likely affect other states on the West Coast, such as Oregon and Washington, as the two Pacific Northwest states may soon see the same price gouging by the fossil fuel industry in Los Angeles.

“I moved to San Diego from the Los Angeles area a little over eight years ago, and I thought I would do this for a couple of months,” says Richard Martin, 60, who has been driving for Uber for eight years. “I left the other day, and I couldn't believe that I had over 12,500 rides.” But Martin says he might leave the Uber business due to high gas prices.

An increasing number of Californians may be turning away from gasoline as an option. “Demand destruction” is when prices are so high that consumers choose to do away with their purchase of that product.

"Above $4 per gallon, you do see the American public change their driving habits. And we do actively see demand destruction," says Regina Mayor, global head of energy at KPMG.

"I think that's one of the things that helps the overall tightness of supply, is when we see demand start to dip back down," she added.

Californians have been turning toward electric vehicles to avoid price spikes at the pump. And while some EVs are more expensive, such as Teslas or BMWs, other brands, including Volkswagen, are more affordable due to monthly rebates that the state offers consumers, like the California Clean Fuel Reward, as well as federal rebates.

Michael Macias, who became California’s millionth EV owner in December 2021, said the cost of gas played a major role in his decision to purchase an EV. Macias used $9,500 in state rebates, $750 from the California Clean Fuel Reward, $7,500 in federal rebates, and, because he is a resident of San Joaquin Valley in Central California, he gets $3,000 rebates from the Air Pollution Control District to purchase his electric Volkswagen.

Macias says that after he factored in the cost of gas compared to the monthly car payments for his new EV, for him, the choice was clear. “So those are the two things that I was thinking about, along with the fact that I am committed to being a good steward of the land,” Macias said. “This is part of me living into those principles and values.”

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