Gas Prices in Some States Surge Toward $3

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Gas prices usually move in tandem with the price of oil. True to form, as crude has jumped from below $50 a barrel in early October to over $57, the price of gas has risen, too. It is now at or near an average of $3 for a gallon of regular in several states.

Nationwide, the average price for a gallon of gas is $2.52. That is up from $2.45 a month ago and $2.14 a year ago. Gas prices fell close to $2 in several states in mid summer. Now, the cheapest gas is in Alabama, which is always among states with the lowest prices, at $2.24. The price is just above that in several states on the Gulf of Mexico and near huge refineries south of Houston. The price is $2.25 in Mississippi and $2.27 in Texas.

At the far end of the spectrum, the average price for a gallon of regular in Alaska is $3.21. In California, the largest state by population, it is $3.20. In Hawaii it is $3.16. In Washington the price is $3.00, and in Oregon it is $2.84.  In Pennsylvania, the sixth largest state by population, it is $2.77.

California’s prices are worse than they seem at first glance because, in its largest cities, prices are among the highest in the nation. Gas is $3.30 in San Francisco and $3.25 in Los Angeles.

In some of the states with the highest gas prices, oil prices are not the only culprit. Several, like Hawaii, do not have substantial refinery capacities of their own. Gas taxes and levies have a bigger effect.  The gas tax in Hawaii is the third highest in the U.S.  California ranks sixth. Pennsylvania has the highest gas tax of any state.

Most states with low gas taxes also have low gas prices. Mississippi has the fifth lowest gas tax among all states. Texas is eighth.

If oil prices continue to rise, the number of states with gas prices above $3 will rise as well. It has been over two years since prices were at that level and if many industry analysts are right, gas prices will remain at the $3 level, or higher.