Today in gas prices

I took the photo last night -- just trying to shake things up artistically -- but prices continue to hold steady at the Chevron at the corner of Hill and Colorado in Pasadena. We've been chronicling the prices at the station over the past month because prices there run high, making it a good candidate for $5 a gallon gasoline, if and when that time comes.

The average price of a gallon of regular in California dipped again today to $4.559, according to AAA. Meanwhile, the national average is $4.108.

Here's the weird part: California last set a record for its average on June 19. The record for the national average was set Monday.

In other words, the price of gasoline in California has taken a slight dip over the last three weeks while the national average is increasing. What's going on?

Cathy Landry, a spokesperson for the American Petroleum Institute, said there could be two factors in play. Gas taxes have slightly increased around the country in the past six months but not in California. In addition, "California is a market of itself because it has different fuel standards than the rest of the nation," she said. "A lot of California's supply is based on what you get from the California, Washington and Arizona refineries, which is a lot different than the rest of the country."

I also spoke with Susanne Garfield, a spokeswoman for the California Energy Commission. She made two key points:

--Gas prices here have historically been higher than outside the state because California requires a cleaner blend of gasoline to be sold here because of air quality concerns. A limited number of refineries in California and elsewhere produce it. Complicating matters, some of the refineries in California also produce gasoline consumed in Nevada, Arizona and Oregon -- limiting how much gas they can produce for Californians. That's one big reason for the price difference.

--But, Garfield said, the commission  ideally would like to see a 20-cent difference between the price of gas here and outside the state. The differential is now about 45 cents and was larger in recent weeks. Garfield said a lot of that had to do with production problems at state refineries in the spring and early summer that have since eased somewhat, along with what appears to be a drop in demand. The end result is that prices have dipped in the Golden State while many of the pressures that caused the run-up in gas prices have increased elsewhere.

I also asked her the big question: production concerns aside, how much of gas prices is really caused by oil companies manipulating the markets to up their profits?

Gasoline is "a world commodity," Garfield said. "Most of them [the gas companies] are international companies and just because they make it [gasoline] here doesn't mean it stays here."

She went on to list a number of factors playing into gasoline prices -- the devalued dollar, financial markets seeking new investments, the ongoing cold winter in South America. Her point, in short, is that the world craves oil-related products, and gasoline prices here are a reflection of that.

--Steve Hymon

photo: Steve Hymon / Los Angeles Times

Comments

[DailySavingsClub]

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[alasdair connell]

hi there
just read your article on fuel prices and in my opinion you have it pretty good. Over here in the uk the prices would work out to around $12.49 a gallon and whats worse is that the usa is getting it from our north sea oil rigs, i would say your national average of $4.108. is pretty good