CA Gas Tax Rises Again, Just In Time For Holiday Travel

CALIFORNIA — Californians driving to their 4th of July destinations will be burdened with another gasoline price hike at the pump beginning Thursday when the state's gas tax rose to 51.1 cents per gallon.

The gas tax hike is an inflation adjustment built into the state's Road Repair and Accountability Act of 2017. Added to the already skyrocketing cost of gas, and Californians are feeling pain at the pump. The average price to fuel up with regular unleaded gas in the Golden State was $4.28 per gallon as of Wednesday, according to GasBuddy.

"Today, 89 percent of U.S. gas stations are selling regular unleaded for $2.75 or more. That is a stark increase over last July 4 when only a quarter of stations were selling gas for more than $2.25," said Jeanette McGee, an American Automobile Association spokesperson, in a statement Monday. "Road trippers will pay the most to fill up for the holiday since 2014."

What's more, the state may see a 40 percent increase in travelers this 4th of July compared to last, AAA spokesperson Sergio Avila told KRON4.

"When it comes to gas taxes in the United States, California unfortunately has the highest," Avila said.

Gas prices have been surging in every state as the nation reopens and Americans move on from the coronavirus pandemic, which plagued the U.S. for more than 15 months and counting. Demand for fuel has risen sharply as more Californians hit the road. Prices have reached highs not seen since 2014.

"Motorists should prepare to dig deeper for the second half of the summer, unfortunately," GasBuddy petroleum analyst Patrick De Haan told The Associated Press.

Prices in California are up 7.7 cents per gallon from last month, according to GasBuddy, and they're expected to climb even more. Nationally, gas prices have risen 5 cents over what they were one month ago and 92 cents higher than this time last year.

This month, the Energy Information Administration predicted gasoline would average $2.92 a gallon nationally for the April to September summer driving season, up from $2.07 a gallon for the same period last year. For the full year, the agency estimated regular gasoline will average $2.77 a gallon, and U.S. households will spend $570 more on fuel than they did a year ago.

But officials from the Federal Reserve say the increases are likely to be temporary.

In an appearance before a House subcommittee last week, Fed Chair Jerome Powell cited “the pass-through of past increases in oil prices to consumer energy prices” as one factor behind the inflation.

Californians also pay more for gas than Americans in any other state. Behind the Golden State was Hawaii, with an average price of $4.28 per gallon, and Washington state, with an average of $3.74 per gallon reported on Wednesday, according to AAA.

The Bay Area has some of the most expensive gas in the entire United States, DeHaan told the San Francisco Gate.

The Western states — California, Oregon and Washington — saw a rise in demand due to the pandemic, but there have also been some refinery issues that rocked the balance of supply, De Haan said.

Regular gasoline pumped from stations around the region is going for about $4.33 per gallon as of Sunday, which is an increase of about 7 cents in one week,

De Haan doesn't think Bay Area gas prices will break the record high set in 2012 at $4.75, but prices may creep up to $4.50 during the summer amid labor shortages and refinery issues.