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California gas prices jump overnight, pass Hawaii

By Gillian Flaccus

Associated Press

LAST UPDATED: 02:57 p.m. HST, Oct 05, 2012

LOS ANGELES >> California gas prices continued surging today, adding another 17 cents per gallon on average, and the increases are expected to continue for at least several more days, ensuring long lines and short tempers at pumps around the state.

A week of soaring costs has led some stations to close and others to charge record prices — in some places $5 or more — as California leapfrogged Hawaii as the state with the most expensive fuel. The average price for a gallon of regular unleaded across California was nearly $4.49 today, 32 cents more than a week ago and the highest statewide average in the nation, according to AAA's Daily Fuel Gauge report. Hawaii's statewide average price was $4.41 a gallon, about a half cent cheaper than last week.

The national average is about $3.79 a gallon, the highest ever for this time of year. However, gas prices in many other states have started decreasing, which is typical for October.

Rebecca Olson, 43, of Irvine, drove to a Costco in Tustin hoping to find lower prices than the $4.65 in her neighborhood, but the pumps were closed.

The part-time preschool teacher said her husband already spends $500 a month on gas, in part because he commutes nearly 100 miles a day to a new sales job after being unemployed for a year.

"All of this is killing us, just because we've got big cars," she said.

They've already parked their GMC Yukon SUV indefinitely. If gas prices keep rising, Olson said they'll sell her husband's Infiniti G35 that requires premium fuel and buy a more efficient car, while making their children ride their bikes to their activities.

"Just last night, we were looking at economical cars, we were car shopping," she said.

The average price for regular gasoline in California hit an all-time high of $4.61 per gallon in June 2008. That could be eclipsed this weekend.

Patrick DeHaan, senior petroleum analyst at GasBuddy.com, expects the increase in prices will slow for several days and then level off. He predicted the average price would peak around $4.85.

A web of refinery and transmission problems is to blame, analysts said. The situation is compounded by a pollution law that requires a special blend of cleaner-burning gasoline from April to October, said Denton Cinquegrana, executive editor of the Oil Price Information Service, which helps AAA compile its price survey.

"We use the phrase 'the perfect storm,' and you know what, this current one makes those other perfect storms look like a drizzle. I don't want to scare anyone, but this is a big problem," Cinquegrana said. "Run-outs are happening left and right."

Among the recent disruptions, an Aug. 6 fire at a Chevron Corp. refinery in Richmond left one of the region's largest refineries producing at a reduced capacity, and a Chevron pipeline that moves crude oil to Northern California also was shut down.

There was some good news. Exxon Mobil Corp. said a refinery in Torrance returned to normal operations today after a power failure limited production for most of the week.

But gasoline inventories in California are still at their lowest point in more than 10 years, a situation made worse by the mandate for the special summer gasoline blend. Few refineries outside the state can make it, meaning there are few outside sources to draw from for help, Cinquegrana said.

The California Air Resources Board was reviewing a request from the California Independent Oil Marketers Association for a waiver that would allow gas stations to begin selling winter-blend gasoline before Halloween.

David Clegern, a spokesman for the air board, said there is no timeline for a decision. The California Energy Commission must review gas inventories to confirm there is a shortage and assess what effect the switch would have on air quality, he said.

Gil Duran, a spokesman for Gov. Jerry Brown, said in an email that his office is "monitoring the situation closely."

DeHaan, the analyst from GasBuddy.com, said the bid to sell winter-grade fuel sooner wouldn't make much immediate difference in the price at the pump.

"The roll-out time is too long," he said.

While prices were higher everywhere in the state, there were variances. Yuba City had the lowest average price at $4.33, according to AAA, while San Francisco was highest at $4.60. Prices averaged $4.54 in the Los Angeles area, $4.52 in San Diego, $4.40 in Fresno and $4.36 in Sacramento.

A station at Vandenberg Air Force Base on the Central Coast was selling gas for $3.91, while the price was $5.69 at a station in Calabasas, outside Los Angeles.

Some stations ran out of gas and shut down rather than take the risk of buying gas at soaring prices only to be stuck with a glut of overpriced fuel if prices dropped or if customers refused to absorb the extra cost that would be passed along to them.

Smaller, independent businesses were hit harder because they lack pre-existing contracts with suppliers that the large chains have, Cinquegrana said.

The price of diesel fuel has also increased, adding significant costs for truckers who typically put hundreds of dollars' worth of gas in their tanks. The average price for diesel statewide was $4.48 a gallon Friday — 35 cents more than a year ago, according to AAA.

At a truck stop and gas station off state Route 99, on the outskirts of Fresno, independent trucker Joel Vargas said if diesel hits $5 per gallon, he will probably stop driving because he would be losing money.

"With that kind of price, I won't be able to support myself and my family," he said.


Contributing to this report were AP writers Jonathan Fahey in New York, Sandy Shore in Denver, Juliet Williams and Hannah Dreier in Sacramento, Jason Dearen in San Francisco, Beth Harris in Burbank, and Gosia Wozniacka in Fresno; and photographer Damian Dovarganes in Calabasas.

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allie wrote:
Lucky we get our overpriced oil from Indonesia!
on October 5,2012 | 06:50AM
EducatedLocalBoy wrote:
Allie, again your ignorance shows. It doesn't matter where the crude oil comes from. Under our free market economy system pricing, the old J.C. Penney pricing motto of charging customers a reasonable profit over what the cost of the product was, is out the window. The pricing scheme is "what the market will bear." The cost of gasoline in Hawaii will soon exceed California because the greedy oil industry barons in Hawaii will not allow gasoline to be cheaper in Hawaii than California for long. Those barons know that no Governor, Democrat or Republican, since Jack Burns over 40 yrs. ago has the will or guts to fight them.
on October 5,2012 | 11:41AM
allie wrote:
HECO spokespersons said we get our oil from Indonesia and that we pay whatever the barrel of oil is there. It has historically been much higher than California The problem in Cal. is temporary due to refinery issues ( fire, an electrical failure, etc.)
on October 5,2012 | 12:56PM
EducatedLocalBoy wrote:
Allie, if you believe what HECO says, then I own the Sand Island bridge, and I'll sell it to you for cheap. Imagine how much money you'll make by having the first toll bridge in Hawaii!!!
on October 5,2012 | 01:44PM
busterb wrote:
I find it hilarious when Romney keeps saying Obama has led gas prices to double what Bush had them at. If you look at a chart of the time, like http://gasbuddy.com/gb_retail_price_chart.aspx, and stretch it out to 5 years, you'll notice that gas was only half if it's current price for about a month. Notice how it fell so drastically, in August of '07... can you say Palin? After she was announced I think the Koch Brothers said... we obviously ain't gonna win, well might as well make the other guy look bad.
on October 5,2012 | 07:35AM
busterb wrote:
Oooops Aug '08.
on October 5,2012 | 08:20AM
tiki886 wrote:
In June and July of 2008, 4 months before the election the price was $4.11 per gallon. By August it was $3.74 and continued to fall until the day after election day the price was $2.07 when Obama was elected President. The cost of gas was $1.84 just six days after President Obama's inauguration. As noted above, that is far cheaper than the cost of a gallon of gas six months prior in July 2008. So who did the lower gas price benefit?

Since then the price HAS doubled under Obama's regime because he said coal, gas and oil needs to artificially increase in price by stopping drilling, stopping coal production in order to make alternative sources of energy viable. Go ahead and tell me its Bush's fault again.

on October 5,2012 | 10:54AM
Manoa2 wrote:
You can blame George Bush for stopping the drilling of oil offshore and his brother Governor of Florida for opposing drilling off of Florida-- although, I would not. The fact is though, that if you understand market economics, the Government cannot change the price of oil. The oil companies are very profitable now and they do not want to spend $Billions for drilling, pipelines, refineries, and all the infrastucture needed to actually get gasoline to the consumer (of course they can ask people like Romney or Obama to do it for them). If the price of foreign oil double or triples, then it might become profitable to start to spend the tremondous amounts needed to develop other resources to store and transport via pipelines and tankers.
on October 5,2012 | 11:31AM
allie wrote:
yup..and it is a world market. We have a glut of natural gas and it is now sold to other countries.
on October 5,2012 | 12:57PM
tiki886 wrote:
Where do you get your education and information from? Big Bird and left wing comedy shows? Shell has spent around $4.5 billion to explore for oil in the Chukchi and Beaufort Seas in the Arctic, which according to the U.S. Geological Survey, has more than 90 billion barrels of recoverable oil and nearly 1,700 trillion cubic feet of recoverable natural gas. After years of delays from the Obama Administration, the company was allowed to move forward with “certain limited preparatory activities in the Chukchi Sea”, according to the Bureau of Safety and Environmental Enforcement (BSEE).
on October 5,2012 | 09:24PM
Oye_Como_Va wrote:
Who else does everyone believe?
on October 5,2012 | 12:42PM
allie wrote:
true..but Romney is famous for exaggeration and shibai
on October 5,2012 | 12:56PM
tiki886 wrote:
Romney actually governed a State. He has a HISTORY of bipartisan agreements with members across the aisle. He had to work with a State legislature that was 87% Democrat. He produced RESULTS! Obama the community picnic organizer on the other hand never governed a single entity and that is why our nation is going to pot and our foreign policy has failed around the world.
on October 5,2012 | 03:21PM
Grimbold wrote:
You know why? They can not get the oil to California because the building of pipelines to there is being blocked by blockhead environmentalists.
on October 5,2012 | 08:11AM
Manoa2 wrote:
The oil companies have sold their refineries in California, so pipelines to send crude oil to California do not help, and the oil companies are making too much money without refining and without paying for pipelines and refineries to want to transport crude oil to California or to drill into difficult to pump wells and resources and pay for the rights to that product. Cheaper to buy foreign product until the price rises enough (2-3X today's prices) to justify spending on develop domestic pipelines, wells, exploration, and the like. Simple economics.
on October 5,2012 | 11:36AM
tiki886 wrote:
How does selling refineries translate into higher prices? If the refineries were sold, who bought them? They didn't just disappear as you seem to suggest.The EPA and the Obama Administration has not allowed a single new refinery to be built since the 1970s! That is what is contributing to high gas prices! That and the fact that once again the EPA has created different formulations of gas "boutique fuels" for different parts of the State. You are ignorant of economics and the facts.
on October 5,2012 | 03:41PM
HD36 wrote:
Dollar value dropping; no new refineries built in the last 70 years; government tax on gas increasing; supply of brent sweet crude going down.
on October 5,2012 | 08:41AM
Maipono wrote:
California is in big pilikia. I saw it when I went for a visit last month, ruled by a liberal governor and legislature, the prices were skyrocketing. There was a train to no-where that was being built for jobs, and a general feeling of let's soak all the businesses and especially the millionaires and billionaires. Only the stupid celebrities remain, everyone has left. Meanwhile, they place all kinds of regulations on the oil industry. California basically is killing the goose that laid the golden egg, they were going bankrupt fast, with many of their municipalities going under, and not paying their obligations. Sad really. Could Hawaii be heading in that direction? Unfortunately, yes, unless we choose wisely, even then we may be going the way of California.
on October 5,2012 | 09:39AM
sailfish1 wrote:
Hawaii prices have always been high and is getting higher. Hawaii is trying to build a too-expensive train for jobs (not for transportation). There are plenty of regulations on building. Hawaii has plenty of dysfunctional government offices and workers. Hawaii is slowly destroying its biggest industry which is Tourism with horrible infrastructure (streets, sewers, etc.) and destroying the beauty of Hawaii. Yeah, Hawaii is headed in the same direction as California - bankruptcy.
on October 5,2012 | 11:14AM
Oye_Como_Va wrote:
What else is there can we name for our U.S. Senior Senator?
on October 5,2012 | 12:39PM
eleu808 wrote:
The EV is looking better today.
on October 5,2012 | 09:49AM
tiki886 wrote:
The existence of the EV is the result of the spike in gas prices because Obama said he was going to shut down coal companies, stop oil drilling (but give Brazil $2 billion in loans to explore for oil) because he wants "America to be their best customer".

Today, The U.S. government (The Obama Regime) is preparing to provide up to $10 billion in loans to finance the development of massive hydrocarbon reserves off Brazil’s coast thought to contain 80 billion barrels of high-quality crude, an amount that could lead to a six-fold increase in Brazil’s current proven reserves and transform that nation into one of the world’s 10 largest oil producers.

Did someone say, man-made global warming?

on October 5,2012 | 11:07AM
Oye_Como_Va wrote:
Yes, until you begin seeing the price of everything else rise besides electricity.
on October 5,2012 | 12:38PM
sailfish1 wrote:
Blame it on the oil companies. The oil companies make humongous profits every year. Yet, they don't build any new refineries or fix old ones. When refineries go down, gas prices go up. Then the oil companies make even more profit.
on October 5,2012 | 11:18AM
Oye_Como_Va wrote:
Blame it on Bush. Don’t you recall that the Energy Secretary Stephen Chu predicted and President Obama said that we could expect to be paying $8 - $10 a gallon gasoline and we would have to pay more for electricity? It is all coming true. We will end the use of coal for energy so more people can freeze their butts off in the winter unless they pay their skyrocketing electric bills and then we will be able to bring the unemployment back up to 9 - 15 %. Hooray!
on October 5,2012 | 12:35PM
tiki886 wrote:
Sailfish is one of the ignorant Obama zombies that refuse to believe it is the Obama Communist Regime and their puppet agency the EPA that has not allowed a single refinery to be built since the 1970s.

Hey, Sailfush, do you think the increase in population since the 1970s has increased the demand for refineries or decreased the demand? Duh!

on October 5,2012 | 03:48PM
sailfish1 wrote:
Hey! What's with the name calling? Are you so angry about Obama that you have become a %^*#$%@?? Best cool down and try to be a decent human being.
on October 5,2012 | 07:26PM
Oye_Como_Va wrote:
Hmmm...now HECO can raise the cost of electricity and say, 'at least they're cheaper that California.' Yes, and they (Executives) will go laughing all the way to the bank with their big bonuses Californians can afford the higher price of gasoline, heck don't they have hybrids & EVs?.
on October 5,2012 | 12:26PM
akuman808 wrote:
Romney should soon blame Obama for the gas price increase in California.
on October 5,2012 | 01:41PM
Bdpapa wrote:
Good, they should pay much higher prices just because.
on October 5,2012 | 02:13PM
tiki886 wrote:
The Democrats, Liberals, Greenies and commies deserve to pay more for gasoline and electricity because they have done everything to increase the price of petroleum on purpose! In fact, as 'Oye' said above, Stephen Chu wants to bring European prices of $8 or more gasoline to the US.
on October 5,2012 | 06:25PM
sailfish1 wrote:
It's too bad you lost your job, are unemployed, and can't make the payments on your junk 2003 Ford Fiesta. You should have finished high school and gone on to college so that you would have a marketable skill. Don't blame the Democrats and Obama - blame yourself for being stu*p%id.
on October 5,2012 | 08:23PM
tiki886 wrote:
Comrade Sailfish! Democrats and Obama did not give me a single penny. They have confiscated my wealth and the wealth of the American people to further their plans for communist totalitarian victory! Hugo Chavez, Fidel Castro and Obama all love each other in the magic circle J**k society of Communist Dictators that they are. You should join their circle.
on October 5,2012 | 08:55PM
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