Gas prices across the nation increased 18 cents over the past two weeks, with fuel costs hitting hardest in California, particularly in San Francisco, where prices peaked at $4.06 per gallon.
California prices increased 23 cents, which means the average driver is shelling out $3.99 per gallon for regular gasoline -- and yes, we have Chevron partly to thank for that.
God only knows how many gallons of fuel went up in flames last Monday when the Richmond-based refinery caught fire due to a small leak. There were no major injuries, but California's gas prices certainly got burned.
co-director of the Energy Institute at U.C. Berkeley's Haas School of Business,
explained that California's gas prices are particularly volatile due to
its fine market. The Golden State mandates companies to sell a particular
mixture of gasoline, which no other states require. California
refineries produce this type of gas mixture, but few other refineries in the nation make it, which means there's a limited supply,
Borenstein, said. So, the state relies primarily on its own refineries
to produce its fuel -- and if one California refinery suffers, the whole state takes
At the time of the fire, the Richmond refinery was producing about one-tenth of California's gasoline. The fire drove wholesale prices up 30 cents per gallon, Borenstein said. Meanwhile, crude oil has increased by as much as $15 dollars per barrel.
Although these stratospheric prices may cause some if you car-happy commuters to turn to BART -- or worse, Muni -- Borenstein says he's sure you will be back in your car in no time, calling this painful spike "a short-run blip."
"I don't think this is going to slow down the economy," he told us. "It will cost the economy a little bit, but there are other things to worry about."
True. Like the toxic air we are inhaling.