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Why are California gas prices so high?

By Catholic Online (NEWS CONSORTIUM)
5/1/2014 (3 years ago)
Catholic Online (www.catholic.org)

State is experiencing a price shock.

Why are California's gas prices so high? This is a question the Golden State's motorists are asking as prices continue to climb into the state's summer driving season.

Gas prices, particularly around airports where people fill up before returning rental cars, are exceptionally high. A full tank can exceed $100.

Gas prices, particularly around airports where people fill up before returning rental cars, are exceptionally high. A full tank can exceed $100.

Highlights

By Catholic Online (NEWS CONSORTIUM)
Catholic Online (www.catholic.org)
5/1/2014 (3 years ago)

Published in U.S.

Keywords: California, gas, prices, ethanol, summer, laws, regulations, politics, oil


LOS ANGELES, CA (Catholic Online) - California is a state apart from all the others in many ways. This natural and political separation comes together to raise the price of gasoline in the Golden State.

While the rest of the nation is barely experiencing spring thaw, after a long, bone-chilling, record-setting winter, California is on the brink of summer. The notoriously short spring is already weeks past for most of the state. Inland temperatures have been in the 90s for a couple weeks and some places will hit the century mark in the week to come.  That summertime heat affects air quality, a painful problem for residents of Los Angeles and the San Joaquin Valley. Asthma and other respiratory illness are common in California because of the high levels of particulate matter and other pollutants in the atmosphere.

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California has the most polluted air in the United States, so it has special fuel regulations which require a special "summer blend" of gasoline be sold in the state during the spring and summer months. To meet this requirement, refineries must go offline at least twice per year to switch formulas. California is the only state to do this. The summer blend uses ethanol which until recently was thought to be cleaner and safer. New research suggests it actually creates more greenhouse gasses than it eliminates.

A poor growing season in the Midwest has also contributed to a spike in ethanol prices in California.

The practice of switching blends also prohibits the import of cheaper gasoline from other states.

California is a bastion of liberal politics which means its environmental policies are stringent. This itself isn't inherently bad, however the politics often create artificially complex situations. For example, the state has not built a single new refinery since 1979 because of strict environmental regulations. Meanwhile, older refineries have closed, essentially reducing the supply of gasoline available to motorists.

This is serious business in a state where the residents are dependent on cars. California is a large state that lacks viable mass transit options for most people, especially in the San Joaquin Valley. San Francisco and Los Angeles, as well as other metropolitan areas, have subways and light rail systems, but the areas in between are virtually unserved by mass transit options.

A plan to connect Los Angeles and San Francisco with a high-speed bullet train has been repeatedly stalled as conservative politicians and constituencies continue to block its development through lawsuits all the way through the central valley.

Even if approved, the high speed rail project would require as much as two decades to complete.

This leaves Californios stuck with their cars, paying high gas prices.

Yet there is a final indignity which exacerbates problems even further. California happens to sit on some of the world's richest oil and natural gas deposits. Despite this abundance beneath the ground, politicians and activists have successfully prevented drilling and fracking across the state. This leaves much of that energy untapped, and forces California refineries to import oil from overseas. Overseas markets are subject to volatility as situations in Ukraine and Libya drive a spike in prices.

California residents are paying well above $4.00 per gallon when the national average is expected to spike around $3.85. California drivers could see prices flirt with $4.50 per gallon. And in the absence of both short-term and long-term alternatives, they can expect such prices to remain high and stick around, much like the summertime temperatures that blanket the state. 

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