If you want to call out something as unstable, then it would be the California Gas prices. Unfortunately, it doesn’t matter which version of gasoline you want for your vehicle, and you will have to pay a premium along with the California tax(which is sky high). This article will walk you through why gas in California is more expensive than in other cities and why there is a higher gas tax in California.
Generally, the people in the Golden state are paying more for gas because of the higher gas tax. The 85 cents that constitute the gas tax is higher when compared to other states. However, even with the rising oil demand worldwide, Californian fuel is treated better with additives to ensure cleaner burning and fewer pollutants.
Here are some of the main reasons why gas is expensive. Let’s get started, shall we,
Reasons why gas is expensive in California:
- The biggest reason is the policy difference; vehicles in California have to abide by specific pollution rules. So you cannot get cleaner air out of a car that quickly. You need higher-quality fuel with additives to achieve that!
- Suppose you look at the national average of gas prices. Californians pay about 35% higher than everyone. But, to be honest, they are trained to pay more, and even if you charge 50% higher than the national average, they will.
- One of the reasons is the loosening of the restrictions globally, which has resulted in a mass demand for crude oil, which was not expected even by the experts.
- Many rules have been put into place in the crude oil reporting nations to make it more streamlined.
- Elections are the other reasons why this happens so often in California. The change in power makes the crude oil companies drive the prices higher and higher rather than having a diplomatic business deal.
- One of the other main reasons is the offline time that gas refineries take during March and April. It’s the downtime for most oil companies in California. This raises the costs of refining and transportation of gasoline due to delays.
- California is a state with excellent natural resources which are not taken advantage of due to state policies.
- When you ask the people about this, they will tell you that “the legislators and bureaucrats working in these sectors don’t have real-world experience.”
- Accountability in the government is also an issue as everyone wants to blame it on inflation, which is also a nationwide problem.
- Failed claims and policy reforms of politicians are another reason why gas is expensive in California and has never been appropriately regulated.
- Everybody quotes senate bill 1, but it’s only part of the problem.
California Gas Tax:
When you take a closer look at the gas price, you can find that gas taxes are the primary reason why the prices are higher than in other states. you can check your gas price requirements for your next trip in our gas price calculator. Here is a chart that shows you the average during different periods in California.
|Year||California Gas price(per gallon)||California Gas tax(per gallon)|
When you look at the gas price since 1990, you can see that the periods with lower prices are during recessions. During regular times gasoline was more expensive compared to other states. The lines on the graph show that California had cheaper gas prices than other states for an extended period which is not valid. Most people think it’s true, but it isn’t! There has been a steady rise in fuel tax throughout these years which is not great for regular consumers.
Oil pipelines from countries like Canada and Mexico have been increasing due to their cheap production costs, which means less refined crude oil has to be imported from the middle east and Venezuela resulting in a decrease in refining costs for California refineries.
Even though we can say that many of these policies have been put in place for the greater good, it has only made fuel expensive and more profitable for oil companies.
There is no simple answer to this question, and if you do a lot of research, you will find that it’s not just one reason why gas prices are high. Instead, it’s a combination of many reasons, such as politics, refining costs, and distribution expenses.
Everyone agrees that the California Gas tax needs to be lowered or reformed for better gas prices, but no one can agree on how it should be done.
Will California gas prices drop?
California gas prices will drop to the same level as any other state if the government would reform its policies to be less strict and more realistic.
To quote, “all forms of energy are subsidized in one way or another”
Governor Brown also agreed that California needs to get rid of its Gas tax, but he thinks it should be done gradually by reducing it by about 1% every year until 2025 when it reaches 10%.
On the other hand, certain people think that this plan is insufficient to survive an economic crisis.
Both sides agree on one thing, which is reforming the oil companies’ taxes. It’s a win-win for everyone involved since both consumers and oil companies benefit from these reforms. See why gas prices keep going up and what you can do about it.
No one is sure what the future holds for California’s gasoline market, but we hope this information will help you understand why it is expensive. Hopefully, something good will come out of these reforms.
California has the most strict environmental rules in place, which is why gasoline prices are high, but it’s only 1 of the reasons.
Oil companies have been increasing their profits by transporting oil via pipelines from Canada to Mexico. Almost no one is regulating them, which means they can charge whatever amount they want.
There are so many problems with California’s gas tax policy that no one can agree on reforming it. Finally, however, there is an agreement to reduce the current tax by 25%.
I hope this article helped you understand why gas is so expensive in California.