As oil trades around $50 a barrel, its recent price increase has had an effect on gasoline prices. In California, where the price of an average gallon of regular is usually high, that price has topped $3 in a number of large cities. Nationally, the average price for a gallon of regular is $2.50. In California, it is $3.01, according to GasBuddy.
Most of the high prices in California are around its largest cities. The average price in San Francisco is $3.24 a gallon. In nearby Oakland it is $3.05 and in San Jose it is $3.07. The areas around Los Angeles have prices nearly as high. The per-gallon price in Los Angeles is $3.08. In Riverside it is $3.10 and in Orange Country, $3.03
There has been a prevailing theory that gas prices erode consumer spending and can hamper gross domestic product. Fortunately, some areas in and near San Francisco and Los Angeles have among the highest household incomes in the United States, so in those areas the economic effect may be muted.
Gas prices in these areas are likely to go higher. The AAA recently issued its forecast for October:
At $2.55, the national gas price average is just two cents cheaper on the week and the most expensive pump price seen at start of October since 2015, when motorists where paying $2.29 for a gallon of unleaded.
“When fall arrives, motorists expect gas prices to be cheaper than they were in the summer. That’s just not the case this year,” said Jeanette Casselano, AAA spokesperson. “Back-to-back hurricanes packed a punch to Gulf Coast refineries’ gasoline production and inventory levels. As they play catch-up, gas prices are going to be higher than we’d like to see.”
California drivers are also hurt by high state taxes and levies. At $3.22 per gallon, California’s number is the seventh highest among all states. If the October forecast is right, some California cities may not have $3 gas for several months, or longer.