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California Gas Prices to Go Up July 1: What to Know
California Gas Prices to Go Up July 1: What to Know

Newsweek

time6 days ago

  • Automotive
  • Newsweek

California Gas Prices to Go Up July 1: What to Know

Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. California drivers will see higher gas prices starting July 1, as two state policies take effect. First, the state's gas excise tax will increase from 59.6 cents to 61.2 cents per gallon, part of an annual adjustment for inflation. At the same time, the California Air Resources Board (CARB) is rolling out stricter rules under its Low-Carbon Fuel Standard (LCFS), which requires fuel producers to cut the carbon emissions from their products more sharply than before. The 2025 benchmark requires a 22.75 percent cut in carbon intensity from 2010 levels—a sharp increase from the previous goal of 20 percent by 2030. To meet these targets, companies will need to blend in more expensive clean fuels or buy emissions credits—costs that are expected to be passed on to drivers. Meanwhile, two major refineries, Phillips 66 in Los Angeles and Valero in Benicia, announced they will close by the end of 2026. The closures will reduce the number of gasoline producers in the state from nine to seven, which could trigger a sharp spike in fuel prices, based on analysis by University of Southern California Professor Michael Mische. His projections indicate gas could hit $6.43 per gallon after the first closure and soar to $8.43 once both refineries are offline, with even higher prices possible under volatile market conditions. Together, these changes could raise gas prices by as much as 6 to 10 cents per gallon. But some experts warn the increase could be even higher. Why It Matters Retail prices for regular grade gasoline in California are already consistently higher than in any other state in the continental United States, often exceeding the national average by more than a dollar per gallon. Therefore, a dramatic surge in gas prices could deepen California's cost-of-living crisis, strain working families, and reverberate through the broader economy. Gasoline prices above 6.00 dollars a gallon are shown at a gas station in Los Angeles on Tuesday, June 7, 2022. Gasoline prices above 6.00 dollars a gallon are shown at a gas station in Los Angeles on Tuesday, June 7, 2022. Richard Vogel/AP What To Know A University of Pennsylvania report projected that changes to California's Low Carbon Fuel Standard (LCFS) could raise gas prices by 65 cents per gallon in the near term and 85 cents by 2030. In response, Senate Minority Leader Brian Jones launched a petition urging lawmakers to repeal what he called an "unaffordable 65 cent gas price hike," arguing, "Californians already face the highest gas prices in the country." As of Thursday morning, the petition has more than 29,000 signatures — 21,000 short of its target. However, the California Air Resources Board (CARB) disputed the 65 cent figure, calling it "misinformation." A spokesperson said prices may rise only 5 to 8 cents and that any increase would come from oil companies deciding how much compliance costs to pass on. Governor Newsom's office echoed that, calling the higher estimate false and emphasizing the LCFS could actually reduce fuel costs per mile by 42 percent by 2045. Studies back this up. Research from the University of Minnesota and Biofuels Digest found little connection between LCFS credit prices and retail gasoline prices. In fact, California's gas price gap with the national average remained steady before and after the LCFS was introduced. Jones rejected those claims, calling them "hogwash," telling Newsweek, "I'm really not too concerned about whether it's 10 cents or 65 cents. Basically we're splitting hairs at that point in time. It probably is in between somewhere. The bottom line is, these regulations are going to cause the price of gasoline to increase." He also accused Newsom's office of trying to walk back an earlier CARB estimate of a 47 cent increase, saying, "They originally came out with 47 cents... and then they had to walk that back." CARB did initially project a 47 cent increase for 2025, but later clarified that the analysis was not meant as a direct pump price forecast. Meanwhile, Democrats in the state Senate unanimously voted down a bill from Jones to pause the LCFS changes, which he claimed was part of Newsom's broader effort to phase out gas vehicles in favor of EVs. "I believe Newsom's goal is to push Californians into EVs under the ideological guise that he's saving the planet," Jones said. Newsom's office defended the policy on environmental grounds, noting that transportation accounts for over half of the state's carbon emissions and nearly all of its toxic diesel pollution. "This is the most impactful step our state can take to fight climate change," Newsom said in 2023, arguing that car emissions worsen asthma, wildfires, and sea-level rise. But Jones dismissed such arguments. "California has done a very good job over the last 20 to 30 years cleaning up our air," he said, adding that the state's emissions make up just "about 1 percent of global emissions," and eliminating all internal combustion engines "would have zero impact on the rest of the planet." Meanwhile, California gas prices remain high. In April, the state's average price per gallon was $4.85—$1.69 higher than the national average. Prices have spiked above $6 twice in the past two years, sparking public backlash and new legislation. What Happens Next The updated Low Carbon Fuel Standard (LCFS) regulations were resubmitted to the Office of Administrative Law on May 16, after being rejected in February. The office has until June 30 to issue a final decision, and if approved, the changes could take effect as soon as July 1.

The State Where Gas Could Top $8 a Gallon Soon — and How To Save on Gas
The State Where Gas Could Top $8 a Gallon Soon — and How To Save on Gas

Yahoo

time23-05-2025

  • Business
  • Yahoo

The State Where Gas Could Top $8 a Gallon Soon — and How To Save on Gas

From 2020 to 2022, inflation wreaked havoc on consumer prices. For some, the pain was most acute at the gas pump, where national prices rose by an astronomical 89.5%, according to the Pew Research Center. Although prices have abated a bit in 2025, one report, as reported by ABC 7 News, suggests that things could get much worse for the state that already has the highest gas prices in the nation — California. In fact, Michael Mische, a professor at the University of Southern California who wrote the report, believes that gas prices could rise to as much as $8 by 2026 in California, which currently has an average gas price of about $4.88, per AAA. Read Next: Check Out: Here are the reasons behind Mische's thesis, along with a look at what Californians can do to save on gas. While it remains to be seen whether gas prices in California will actually reach $8 per gallon, there are some solid economic principles behind Mische's prediction — specifically, the law of supply and demand. Several refineries in California, including ones in Benicia and Los Angeles, are slated to close. This will lower the supply of oil and gas, knocking the supply-demand equation out of whack. As any economics student can tell you, when the supply of a good or service that is in demand falls, its price rises. That's exactly what Mische sees happening in California. Not everyone agrees. California's governor, Gavin Newsom, is one of the most vocal critics of Mische, questioning both Mische's credibility and his predictive model, ABC reported. Learn More: State governments don't control gas prices, but the policies they enact can certainly influence them. To that end, Mische had some direct recommendations for California's governor and legislators, ABC reported. Those include rolling back the state excise tax, delaying any low-carbon fuel standard implementation and capitating cap-and-trade to a fixed amount. 'Those would all be beneficial to the California consumer,' Mische said. While individual consumers don't have much control over the direction of gas prices, there are some steps everyone can take to help minimize the pain. Use mobile apps to find cheap gas: A number of apps like GasBuddy can show the lowest gas prices available in a given area. Pump regular gas: Although gas stations are good at making midgrade and premium fuel sound attractive, and even necessary, the truth is that regular unleaded fuel is perfectly fine for the vast majority of cars on the road today. Always using regular gas can save you a significant amount of money. Take advantage of discounts: Some gas stations offer a discount if you use cash instead of a credit card. If you use a credit card, consider using one that gives you cash back or other bonuses for purchases at gas stations. Most major oil companies also offer their own credit cards that can provide discounts on the amount you pay at their stations. Plan your trips: Combining your daily trips into one and using a fuel-efficient method to reach all your stops is a good way to lower your gas costs. Cut down on your driving: Consider using public transportation or ride-sharing to avoid paying for gas. More From GOBankingRates These Cars May Seem Expensive, but They Rarely Need Repairs Sources Pew Research Center, 'Eggs, gasoline and car insurance: Where inflation has hit Americans hardest.' ABC 7 News, 'California gas prices could top $8 a gallon by 2026, new study says.' AAA, 'Fuel Prices.' This article originally appeared on The State Where Gas Could Top $8 a Gallon Soon — and How To Save on Gas

The State Where Gas Could Top $8 a Gallon Soon — and How To Save on Gas
The State Where Gas Could Top $8 a Gallon Soon — and How To Save on Gas

Yahoo

time23-05-2025

  • Business
  • Yahoo

The State Where Gas Could Top $8 a Gallon Soon — and How To Save on Gas

From 2020 to 2022, inflation wreaked havoc on consumer prices. For some, the pain was most acute at the gas pump, where national prices rose by an astronomical 89.5%, according to the Pew Research Center. Although prices have abated a bit in 2025, one report, as reported by ABC 7 News, suggests that things could get much worse for the state that already has the highest gas prices in the nation — California. In fact, Michael Mische, a professor at the University of Southern California who wrote the report, believes that gas prices could rise to as much as $8 by 2026 in California, which currently has an average gas price of about $4.88, per AAA. Read Next: Check Out: Here are the reasons behind Mische's thesis, along with a look at what Californians can do to save on gas. While it remains to be seen whether gas prices in California will actually reach $8 per gallon, there are some solid economic principles behind Mische's prediction — specifically, the law of supply and demand. Several refineries in California, including ones in Benicia and Los Angeles, are slated to close. This will lower the supply of oil and gas, knocking the supply-demand equation out of whack. As any economics student can tell you, when the supply of a good or service that is in demand falls, its price rises. That's exactly what Mische sees happening in California. Not everyone agrees. California's governor, Gavin Newsom, is one of the most vocal critics of Mische, questioning both Mische's credibility and his predictive model, ABC reported. Learn More: State governments don't control gas prices, but the policies they enact can certainly influence them. To that end, Mische had some direct recommendations for California's governor and legislators, ABC reported. Those include rolling back the state excise tax, delaying any low-carbon fuel standard implementation and capitating cap-and-trade to a fixed amount. 'Those would all be beneficial to the California consumer,' Mische said. While individual consumers don't have much control over the direction of gas prices, there are some steps everyone can take to help minimize the pain. Use mobile apps to find cheap gas: A number of apps like GasBuddy can show the lowest gas prices available in a given area. Pump regular gas: Although gas stations are good at making midgrade and premium fuel sound attractive, and even necessary, the truth is that regular unleaded fuel is perfectly fine for the vast majority of cars on the road today. Always using regular gas can save you a significant amount of money. Take advantage of discounts: Some gas stations offer a discount if you use cash instead of a credit card. If you use a credit card, consider using one that gives you cash back or other bonuses for purchases at gas stations. Most major oil companies also offer their own credit cards that can provide discounts on the amount you pay at their stations. Plan your trips: Combining your daily trips into one and using a fuel-efficient method to reach all your stops is a good way to lower your gas costs. Cut down on your driving: Consider using public transportation or ride-sharing to avoid paying for gas. More From GOBankingRates 4 Affordable Car Brands You Won't Regret Buying in 2025 Sources Pew Research Center, 'Eggs, gasoline and car insurance: Where inflation has hit Americans hardest.' ABC 7 News, 'California gas prices could top $8 a gallon by 2026, new study says.' AAA, 'Fuel Prices.' This article originally appeared on The State Where Gas Could Top $8 a Gallon Soon — and How To Save on Gas

New report warns California gas prices may soar past $8 a gallon by 2026
New report warns California gas prices may soar past $8 a gallon by 2026

Yahoo

time11-05-2025

  • Business
  • Yahoo

New report warns California gas prices may soar past $8 a gallon by 2026

SAN DIEGO (FOX 5/KUSI) — A new report warns gas prices locally and across California may rise up to 75% by 2026 as refinery capacity shrinks. The average price for a gallon of regular gas in San Diego County rose Saturday to $4.79, nearly two dollars more than the state average of $3.13, but in the months to come all drivers in California could all be paying much more to fill up. With warmer months ahead, we can expect something besides just temperatures to go up. 'Historically, we always pay a little bit more for gas during the summer because of that high demand and because of that summer blend gasoline,' said Annlleyn Venegas, Senior Public Specialist with the American Automobile Association. Venegas said price shifts are also often influenced anytime there are fears about supply. The report by Michael Mische at USC's Marshall School of Business warns fuel prices could top $8 by the end of next year. San Diego-area drivers are dreading what might be coming at the pump. Gas prices could top $8 in California by 2026 due to refinery closures, report warns 'I'm probably going to drive a lot less if I'm having to pay that much for gas. It's concerning. We already pay more than every other state,' said resident Austin McAdams. 'It would be less travel. I would have to make different plans and things like that. So, it would definitely be more of a hardship,' said resident Leslie Brown. The report cites the scheduled closures of the Phillips 66 Refinery in Los Angeles this October and Valero's Benicia Refinery next April. It states when that happens, it could mean a potential 21% reduction in the state's refining capacity over three years, and some lawmakers are waving the red flag. 'We are in a current financial crisis and we're on the precipice of a financial disaster if the governor doesn't get his arms wrapped around this problem and get it fixed,' said State Senate Minority Leader Brian Jones, R-San Diego. Jones sent a letter to Governor Gavin Newsom urging him to 'find immediate solutions and prevent further closures.' Newsom's office pushes back on report claiming 75% spike in California gas prices by 2026 Governor Newsom has disputed the study's findings. Taking to X, his press office shared a letter he sent to the California Energy Commission directing it to 'redouble efforts to work with refiners to ensure a safe, affordable and reliable supply of gasoline.' As they keep tabs, some experts are waiting for clarity with the rest of us. 'It's really hard to know for sure what could happen in the near future,' said Venegas. The study also suggested ways lawmakers can lower gas prices, such as revoking a plan to ban the sale of new gas-powered cars by 2035, and easing restrictions on in-state petroleum production. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

California gas prices could reach $8 by end of 2026, report says
California gas prices could reach $8 by end of 2026, report says

CBS News

time09-05-2025

  • Business
  • CBS News

California gas prices could reach $8 by end of 2026, report says

SACRAMENTO — Gas prices in California could reach more than $8 per gallon by the end of 2026, marking a potential 75% increase over current rates, according to a new report. The study, led by Michael A. Mische of USC's Marshall School of Business, projects that regular gasoline could cost between $7.35 and $8.43 per gallon — up from the statewide average of $4.82 as of April 23, 2025. While the exact price point depends on market variables, Mische says there is a clear trend: "The models all indicate the same thing — the price of gas is going up." A major contributor to the projected price spike is the scheduled closure of two key oil refineries: Phillips 66 in Los Angeles and Valero in Benicia. According to the report, these closures would reduce California's refining capacity by 21% over the next three years, potentially removing 6.6 million to 13.1 million gallons of gasoline per day from the state's fuel supply. California currently consumes over 13.1 million gallons of gasoline daily, while producing less than 24% of its crude oil needs. "We're not going to see a 20% drop in demand to match that reduction," Mische said. "That creates a significant supply shortfall." California is also losing about 20% of its refinery production, a reduction Mische says is equivalent to over half the total production capacity of the state of Washington. "We're not going to see a 20% drop in demand to match that reduction," he said. Mische highlighted points from the study in an interview with CBS13 that create a mix of factors driving up prices: Increasing state excise and sales tax, expanding cap-and-trade program costs, a pending change to the Low Carbon Fuel Standard, declining in-state oil production and refinery capacity, the state's lack of incoming fuel pipelines, and increasing reliance on costly maritime transport. The logistics challenges extend to global instability. "Any disruption to maritime transport—geopolitical events, a hurricane in the Gulf, labor disputes—could cause major problems," Mische said. "We're putting ourselves in a vulnerable position." The LCFS alone, if passed in its current form, could raise prices by nearly 10%, according to estimates Mische cited — though he noted that the California Air Resources Board has since removed specific price projections from its website. Other hidden costs include transportation, since gasoline may now need to be shipped in from the Gulf Coast or Asia, as well as storage reserves. "Refiners are required to hold 14 to 16 days' worth of gasoline on reserve," said Mische, "and the cost of maintaining that reserve will be passed on to consumers." Mische noted that the data used in the study were provided by the State of California through publicly available data, as well as data from the Federal Government, which was also publicly available. Mische emphasized that the study isn't a doomsday prediction—it's a risk assessment. "We layered in a wide array of variables—from refinery capacity and seasonal blends to global spot prices and consumer demand elasticity," he said. "It's not about whether the price hits exactly $8. It's about understanding the trajectory and being prepared." Stockton gas station raises prices Ernie Giannecchini has owned and operated Ernie's General Store and Deli in Stockton for forty years. Typically, he's the cheapest gas in town with his cash price coming in under $4, at times. He told CBS13 this is his way of turning the tables on big oil companies and saving some pain at the pump for his customers. Over the holidays, he's dropped the cash price for a gallon and customers have responded by showing up and showing out, supporting the small business. A week ago, Giannecchini said the price was $3.99, but on Thursday, he was forced to go up to $4.49. It's still below the state average per gallon, but it's not the lowest for his customers, something he says he wishes he could change. "My prices have to go up because I'm at rock bottom prices, I'm just basically at my cost right now, and I usually try to be the lowest price in the area, in Stockton... I have a lot of loyal customers," Giannecchini said. He told CBS13 he hopes that the price can go back closer to what it usually is for customers, the lowest in town. But as of now, he explained, there's "no end in sight" for the price going up. Governor's office responds In a statement to CBS13, a spokesperson for the Governor, Daniel Villasenor, noted that in March, Gov. Gavin Newsom directed the state to redouble efforts to work with refiners to ensure a safe, affordable, and reliable supply of gasoline. The statement read: "In the two years since the Governor signed California's gas price gouging law, the state has avoided severe gasoline price spikes like the historic 2022 spike, saving Californians billions of dollars at the pump. The law established the nation's first state-level independent petroleum watchdog to hold Big Oil accountable, and the state has more transparency from the industry than ever before. Governor Newsom will keep fighting to protect Californians from price spikes at the pump." California Republicans demand action In a statement, Senate Minority Leader Brian W. Jones (R-San Diego) warned of a looming "energy and economic crisis", citing the same study by Mische. In a letter to Governor Gavin Newsom, Jones urged immediate action to halt the shutdowns, calling them a threat not only to fuel prices, but also to thousands of good-paying jobs and California's energy security. He blames state policies and excessive regulations for pushing refineries out of operation. "We're not just losing gas. We're losing jobs, losing local economies, losing our grip on affordable living in California, and losing a critical layer of our national security," Jones said.

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