Gas Prices Surge Near $5 in Some Cities

By Douglas A. McIntyre Published Oct 1, 9:15AM EDT

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In some U.S. cities, the average price of a gallon of regular gasoline is well above the nationwide average.
That could be a sign of things to come as oil prices rise.

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Gas Prices Surge Near $5 in Some Cities — © guroldinneden / Getty Images

The average price of a gallon of regular gasoline nationwide is $3.16. In some cities, that figure is near $5, which could be a sign of things to come as oil prices rise. U.S. crude stockpiles have increased supply concerns. About two-thirds of the price of a gallon of gas is due to crude prices.

The price of gas in San Diego and Los Angeles is about $4.75, which puts them 50% above the national average. The price has hit similar levels in Seattle.

California has several factors that make its gas prices high. It does not have many refineries set up to refine oil into car gasoline at this point. That means high transportation costs from other parts of the country. The state’s gasoline tax is $0.71 per gallon. At the other end of the spectrum, the figure is $0.09 in Alaska.

California has legislation to make its gas “cleaner” than the rest of the nation. According to Cal Matters, “The program, which has existed since 2011, is a $2-billion credit trading system that requires fuels sold in California to become progressively cleaner, while giving companies financial incentives to produce less-polluting fuels, such as biofuels made from soybeans or cow manure.” This and its low carbon emissions standard can add several cents per gallon as well.

The gas price is one reason that California is one of the most expensive states to live in. Some areas in the state have a cost of living that is almost 50% higher than the national average. Transportation and housing costs, along with the costs of some fuels, drive the cost of living.

Some Americans Are Stockpiling Due to Inflation Concerns. Should You?

High and rising gas prices can trigger consumer price index increases. So far this year, that has not been true. In August, according to the Bureau of Labor Statistics, gasoline prices nationwide fell 6.5% year over year. However, with the increasing price of oil, it is unlikely that the future will continue downward. Without “help” from oil prices, gas prices everywhere, including California, will rise as they did in 2022, when the supply of oil in the United States was low.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.