Steering You Right With Sharon Peters
Q: We noticed that whenever we go to our ski cabin in Colorado, the gas is always considerably cheaper there than at home in California. This isn’t just sometimes. It’s always. Why would that be the case?
A: Variation in gas prices over time is the norm, as we all know. But gas prices are consistently higher in some regions or states, and there are a few factors.
Taxes can play a part. So can rent prices, traffic patterns and a lack of competition (pump prices usually are highest where there are few or no other gas stations, as you’ve no doubt noticed when you’re in middle-of-nowhere America and get off the interstate for a fill-up).
But according to the U.S. Energy Information Administration, this is the biggest factor: prices tend to be higher when the fuel being sold is a great distance from supply sources (refineries, ports and terminals).
During 2015, the average price per gallon varied dramatically region to region, according to figures compiled by that agency: $2.41 in New England; $2.44 in the central Atlantic states; $2.29 in lower Atlantic states; $2.33 in the Midwest; $2.16 along the Gulf Coast; $2.40 in the Rocky Mountain states; and $2.97 on the West Coast.
That said, California gas always is the most expensive (and most variable) in the country, according to the EIA. That’s largely because California has a reformulated gasoline program that is much more stringent than the federal government’s program and there are relatively few supply sources of California’s unique blend of gasoline.
This cleaner fuel that California sells costs much more to produce. Add to that the fact that state taxes on gasoline in California are higher than they are in most other states, and you wind up with pump prices that startle visitors from most of the rest of the nation.
The EIA states that California refineries run at nearly full capacity to meet demand. And if two or more of the refineries experience problems at the same time, gas prices in the state jump significantly, as there aren’t many options for buying the fuel elsewhere. It’s a situation that likely isn’t going to change any time soon.
© CTW Features
What’s your question? Sharon Peters would like to hear about what’s on your mind when it comes to caring for, driving and repairing your vehicle. Email Sharon@ctwfeatures.com.
