Personal Finance
With CA Gas Prices Expected To Hit All-Time Record, Newsom Orders Shift To Cheaper Blend
Gov. Gavin Newsom ordered an early shift to the state's winter gas blend, but he has rejected the idea of implementing a gas tax holiday.
SACRAMENTO, CA — As California's gas prices inch toward a record high, Gov. Gavin Newsom on Monday suspended the state's summer-blend requirement — a move that could soon drive prices down by as much as 30 cents per gallon.
In switching to the winter-blend, the governor had to direct the California Air Resources Board to allow the winter-blend to be manufactured and sold immediately. California's summer blend is designed to to reduce smog and lower air-pollution during hot weather, but it's pricier for customers.
California doesn't usually permit the sale of winter-blend gasoline until Nov. 1.
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As of Tuesday, the average price for a gallon of regular gas is $6.38, according to AAA. The average cost of mid grade and premium fuel were $6.6041 and $6.8009, respectively. The state's record for a gallon of regular gasoline is $6.44, which was set on June 14, 2022.
Newsom signed Senate Bill 795, authored by Senator Bob Archuleta (D-Pico Rivera), removing regulatory barriers to help lower fuel costs for California drivers.
On Monday, the Governor's office accused "Trump's Iran war" of costing Americans more than $120 billion in extra fuel costs, including Californians $428 per household over the past seven months. Diesel prices have already shattered previous records, passing $8.40 per gallon and potentially driving up costs on goods shipped by truck.
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"Trump's war in Iran has driven up the price of oil around the world, and Californians have been paying the price every time they fill up. For over seven months, the Trump administration and Republicans in Congress have failed to protect working families from their nationwide gas and diesel price crisis – and there is still no end in sight to the war. California will keep doing what we can to bring costs down and protect consumers – but states cannot indefinitely insulate families from a global oil shock. Trump must end his war," Newsom said in a statement on Monday.
"The choice could not be clearer: Donald Trump is doubling down on the volatile, expensive fossil fuels that leave Americans exposed to wars, price spikes, and Big Oil's greed. California will keep building a future where California families are no longer at the mercy of global oil markets."
Winter-blend fuel is cheaper to produce than summer-blend fuel. Winter blends are processed with cheaper additives such as butane, while summer blends involve a longer refining process, which can drive up production costs. The summer version also has about 1.5% to 2% more energy density per gallon, making it more fuel efficient.
According to AAA, the price of winter-blend gasoline is also affected by driving habits — people tend to drive less during winter months.
California consumers could potentially see a drop in prices at the pump with a gas tax holiday, but Newsom has repeatedly rejected the idea of suspending tax on gasoline.
When California drivers will see noticeable relief at the pump is still up in the air, experts say.
"Average gasoline prices fell in slightly more than half of states over the last week, with the Great Lakes seeing the largest declines after a major refinery successfully restarted, while the West Coast moved in the opposite direction as refinery snags there sent prices jumping significantly," Patrick De Haan, head of petroleum analysis at GasBuddy, which provides real-time gas price information from more than 150,000 stations, said in a statement released Monday.
The national average price is 2 cents less than one week ago but 37.4 cents more than one month ago and $1.32 higher than one year ago. It has increased $1.473 since the attack on Iran.
The national average price is at its highest amount this late in the calendar year, according to De Haan.
"With oil holding below $100 per barrel, many Americans may see modest declines ahead for gasoline, but the West Coast faces continued pressure with further increases possible. The broader geopolitical situation remains fluid and could push prices in either direction with little warning."
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City News Service contributed to this report.
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