LA Gas Prices See Sharp Increase

A looming crisis with Syria has sent Southern California gas prices skyrocketing to the highest levels since 2015. There is a myriad of factors leading to the higher prices at the pump. Recent threats by President Donald Trump regarding a possible military action toward Syria in response to the alleged chemical attacks against civilians is causing a spike in crude oil prices. A higher gasoline tax imposed by the state of California combined with the usual seasonal spring spike in gas demand are also contributing factors to the price increase. In November, Califonia lawmakers passed a new state law which raised the state's gas excise tax by 12 cents per gallon in an effort to improve California's declining transportation system.

The U.S. Energy Information Administration reported that the average price for regular gasoline in the state is now at $3.522 a gallon. This price was reported early in the week of April 9 and represents an increase of 50 cents per gallon since the fall of 2017. Prices in the Los Angeles metropolitan area are even higher with the average price of regular gas jumping to $3.579 per gallon, according to the Automobile Club of Southern California.

Although many Trump critics are blaming the President's tweets aimed at instigating conflict with Syria for the sharp increase in the price of crude oil, some analysts assert that even a full-blown conflict with Syria would not lead to long-term higher prices at the pump. AAA spokeswoman Marie Montgomery believes it would take a conflict of high proportions to move the needle at the pump significantly. On the local front, Montgomery believes the California increase is more of a result of local refinery activity.

A strong national economy and the large federal tax cuts have increased demand for petroleum as consumers are not hesitant to keep filling their tanks. Patrick DeHaan, an analyst at the fuel-tracking site, does not believe gas prices in the metro area will top $4 per gallon any time soon, but he also does not believe it will dip below $3 per gallon this summer.



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