Oct. 11–For the first time in four years, gas prices are climbing back to near $4 per gallon.
Prices hit $3.81 statewide on Wednesday, the highest price since July 2015, and more than 80 cents higher than this time last year.
A survey of 300 stations saw San Francisco’s prices about $3.92, Oakland $3.83 and San Jose $3.81.
“Why?” asked motorist Merlin Dorfman of San Jose.
There are several reasons. The tension between Iran and President Donald Trump is playing havoc with crude oil prices, a natural gas explosion this week in Canada has shut production at several gas refineries, California’s still roaring economy, the state’s 12-cent a gallon gas tax increase to fill potholes and the state is still using the more expensive blend of summer fuel to combat smog.
“Gas prices have jumped more than 20 cents across the state in the last 30 days due to a big crude oil rally, which saw prices jump to about $77 a barrel a few days ago after beginning September closer to $65 a barrel,” Micheal Blasky of AAA. “To give you perspective, the price of crude was around $50 a barrel at the beginning of 2018, and at that point California’s average statewide price was $3.10.
And, he added: “Mostly, because of international politics between Iran and the U.S., and speculation on where oil might go. Many speculators are anticipating $100 a barrel prices for oil, and while I think that some traders are being optimistic, AAA isn’t making that prediction.
“The key wildcard is White House pressure to limit exports from that country. Early November is the time frame for critical sanctions for Iranian crude exports and the midterm elections.”
The gas pipeline explosion in Canada will only add to the pain at the gas pumps.
“Prices may continue to lift in California, mainly in Northern California after the natural gas pipeline explosion in Canada that has shut down refineries,” said Patrick DeHaan of Gasbuddy.com.
“Monitor the situation carefully. It will likely mean product will flow north from California and bring a pinch to your pumps.”
California last averaged $4 a gallon on July 27, 2014.
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