Gas prices jump a dime in state
California’s average gasoline price jumped more than a dime a gallon over the last week, leading another week of price increases in most of the nation, the Energy Department said Monday.
The average price of a gallon of self-serve regular gas in California rose to $2.215, up 10.2 cents, according to the department’s weekly survey of filling stations. That was still 89.3 cents lower than the year-earlier price.
By contrast, most of the rest of the U.S. was still enjoying prices of less than $2 a gallon. Nationally, the Energy Department said, a gallon of gasoline was averaging $1.926, up 3.4 cents over the previous week and $1.034 below the price at this time last year.
Analysts said the West Coast had the dubious distinction of being the nation’s strongest market for refiners, which are struggling to make their usual profits in many other parts of the U.S.
“The most remarkable turnaround has been on the U.S. West Coast, where prices are now the most expensive in the land,” said Ben Brockwell, director of data and pricing services for the Oil Price Information Service in Wall, N.J. “That’s a complete about-face from late 2008, when L.A. gasoline prices trailed U.S. markets east of the Rockies.”
Brockwell said that unfinished California-grade gasoline had been trading at the rough equivalent of $71 a barrel.
One of the reasons has been refinery production cuts and downtime. California refineries run by Exxon Mobil Corp. and Chevron Corp. were expected to restart this week but haven’t, analysts said.
Another reason: The West Coast switches to a more expensive blend of summer-grade gasoline sooner than the rest of the nation, and that switch is underway, said Bob van der Valk, fuel-pricing analyst for 4Refuel Inc. in Lynnwood, Wash. That formula change also leaves refiners with less gasoline from each barrel of oil.
“You wind up with 19 gallons . . . instead of the usual 21 gallons,” Van der Valk said. “So you’ve reduced the supply almost overnight.” He added that he expected gasoline to top $2 a gallon nationally by the end of the week, with California hitting $2.25 a gallon.
Crude oil for March delivery, buoyed early by hopes for a U.S. stimulus package, ended the day down 61 cents at $39.56 a barrel after trading as high as $42.43 a barrel on the New York Mercantile Exchange.
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