Gas prices at highest point in years with state tax set to increase next week

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Some of the highest gas prices in town are posted on a signboard at a gas station in downtown Los Angeles on June 22, 2021, as gasoline prices rise. (FREDERIC J. BROWN/AFP via Getty Images)

Latest: Why San Diegans are paying more at the pump

SAN DIEGO — The cost of gasoline in Southern California has climbed to its highest level in years with under a week until an automatic increase in the state’s gas tax goes into effect.

(Auto Club of Southern California)
(Auto Club of Southern California)

Pump prices are up across the region, with San Diego-area drivers paying about $4.26 for a gallon of regular gas as of Saturday morning. In AAA’s latest weekly report, the region ranked behind Orange County and the Los Angeles area for third highest in the Southland.

In Orange, Riverside, San Bernardino and Ventura counties, the average cost of regular unleaded varied from about $4.20 to $4.24 per gallon.

“Average gas prices are at levels we haven’t seen since September 2014,” Auto Club spokesman Jeffrey Spring said in a statement.

Prices began to increase throughout the region again after leveling off for a week, and the spike could continue after flaring issues were recently reported by two local refineries, according to Spring.

That “usually translates into production issues,” he said. “We’ll see in the next few days how this might affect retail prices.”

Fuel costs are also currently significantly higher than this time last year, when coronavirus stay-at-home orders kept many drivers off road, driving down demand for gas.

Still, Southern California pump prices are — at least for now — well below the record-setting levels in October 2012, when they ranged from an average of $4.64 to $4.72 per gallon.

But the state’s already highest-in-the-nation gas tax is set to climb again in one week, to 51.1 cents — a 0.60 cent increase that is tied to inflation, according to the Los Angeles Times.

The automatic increase is due to Senate Bill 1, a legislative package that was signed into law in 2017 and incrementally raises the fuel excise tax annually to in part help fund road and bridge repairs.

So when can drivers expect some relief from soaring gas costs? Unfortunately for people looking to hit this road this summer, prices likely will remain higher until fall, according to one expert.

“With the economic recovery from Covid continuing, gasoline demand has been very strong. Amidst lower oil production as oil companies struggle to raise output, gas prices have been higher this summer than in the past few years,” Patrick De Haan, the head of petroleum analysis at the fuel pricing website GasBuddy.com, explained in a blog post Wednesday.

That’s true not just for California — where gasoline on average costs the most in the U.S. — but in the rest of the country, too.

“Once market forces begin to balance, I expect prices to moderate this fall and over time, oil production will again rise, helping bring gas prices down to earth as soon as this fall, but the road may remain bumpy until the pandemic is behind us,” De Haan said.

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