California residents experience rising gas prices, California governor promises relief
The ongoing conflict between Russia and Ukraine has led to record-high gas prices across the country. Photo illustration by SIMRAH AHMAD, Staff Photographer
Over the past two weeks, the price of regular, unleaded gas has shot up almost 22% to a current national average of $4.262 a gallon. This sharp increase in price can be largely attributed to Russia’s invasion of Ukraine, according to Chapman University economics professor Steven Gjerstad.
“(Russia) supplies a large proportion of the oil for export in the world. They produce about 11 million barrels each day,” Gjerstad said. “A lot of those barrels are being turned away from ports all over the world because countries do not want to provide financial support to the Putin regime.”
California has the highest gas prices in the nation, with the average price in the state being $5.835 per gallon, and Orange County alone has an average rate of $5.923 a gallon. These high prices are putting a strain on many residents struggling to afford fuel.
Senior film production major Ariel Becker told The Panther that she has been incredibly impacted by rising gas prices by virtue of having to frequently commute to off-campus productions.
“I decided to dedicate my last semester to being on as many sets as possible for (the) Dodge (College of Film and Media Arts), and now, I find it hard to do without gas reimbursements,” Becker said. “My budget for each semester is about $500, and with these gas prices, each tank takes about $65 of that.”
California Gov. Gavin Newsom addressed rising gas prices in his March 8 State of the State Address, making a commitment to decreasing the financial toll of inflation on state residents.
“Look, no one’s naive about the moment we’re living in, with high gas prices and the geopolitical uncertainty fueling them,” Newsom said. “That’s why — working with Legislative leadership — I’ll be submitting a proposal to put money back in the pockets of Californians, to address rising gas prices.”
In an attempt to fix the issue, Republican state legislators failed to get enough votes to suspend the 51 cents per gallon tax on gasoline in a March 14 vote. Following the ruling, the Senate Republican Caucus sent a letter to Newsom that same day asking him to reconsider the suspension of the gas tax.
“(Suspending the gas tax) would dramatically reduce the cost of living by driving down retail prices, and (it would) help control inflationary impacts on the economy that are driven by, among other things, the cost of gasoline,” the Senate Republican Caucus wrote. “All this is still possible without putting infrastructure projects at-risk if those funds are instead backfilled through the state budget.”
Backfilling funds lost from cutting the gas taxes would entail using state general fund dollars to supplement lost tax revenue.
In contrast, a group of 10 Democratic lawmakers proposed March 16 that the state send a $400 rebate to every Californian taxpayer to help offset high fuel prices. This was included in a letter sent to the governor, Assembly Speaker Anthony Rendon and Senate President Pro Tem Toni Atkins.
“Notably, we believe a rebate is a better approach than suspending the gas tax — which would severely impact funding for important transportation projects and offers no guarantee that oil companies would pass on the savings to consumers,” the Democrats wrote in their letter.
According to Gjerstad, there are numerous reasons why California’s gas prices are particularly high. For starters, the state is what is known as a “fuel island,” producing only enough gasoline to meet 30% of its needs while importing the rest from Alaska and other countries like Ecuador, Saudi Arabia and Iraq.
“California is completely disconnected from the pipeline network for crude oil in this country,” Gjerstad said. “Oil can be imported from other states by rail or from other countries by ship, but it is going to add to the cost.”
According to Western States Petroleum Association, taxes combined with programs aimed at reducing greenhouse gas emissions added $1.27 per gallon to California gas prices in the last month.
“If you look along the border between California and neighboring states, you will see that the price (of gas) is about $1 lower on the Arizona and Nevada side,” Gjerstad said. “A lot of that has to do with programs that California has for environmental protection, including the cap and trade program and the carbon fuel tax.”
The carbon fuel tax is a tax levied on the carbon content of fossil fuels used for transportation including gas, diesel, and jet fuel. The cap and trade program places declining limits on major sources of greenhouse gas emissions in California. Each year, fewer allowances are created and the annual cap declines — which, in turn, raises the price of fuel.
At the start of the pandemic, oil prices fell to some of the lowest levels in the last century, plummeting from around $18 a barrel to negative $37 a barrel, according to Gjerstad. This led oil companies to drastically cut production and lay off employees. However, with vaccination efforts leading many Americans to return to work and school, oil companies have been slow to catch up to the rapidly growing demand for gasoline.
Regardless, the U.S. remains the world’s largest producer of both oil and natural gas.
“Over the past 100 years, oil production in the U.S. has never risen as fast as it did during the period from 2011 until the beginning of 2020.”
Despite this, many Americans are critical of President Joe Biden’s efforts to decrease the country’s reliance on fossil fuels. In his March 8 announcement of a nationwide ban on Russian oil imports, Biden cast the blame for inflation squarely on Russian President Vladimir Putin.
“The decision today is not without cost here at home,” Biden said. “Putin’s war is already hurting American families at the gas pump. I’m going to do everything I can to minimize Putin’s price hike here at home.”
It can be difficult to predict how long gas prices will remain inflated, according to Gjerstad. Several fuel companies including Shell, BP and ExxonMobil have already suspended operations in Russia.
Some experts, including American Automobile Association spokesman Devin Gladden, who was also an adviser at the Energy Department during former President Barack Obama’s administration, predicts that oil prices will remain high as long as the conflict in Ukraine continues.
However, Gjerstad remains hopeful that Americans will see a drop in fuel prices soon, seeing that only about 3% of the crude oil used in the U.S. comes from Russia.
“The United States has extraordinary capabilities to extract oil from shale (refined sedimentary rock used to create oil) that is, (in) some cases, more than a mile deep into the Earth,” Gjerstad said. “They have so much oil in Texas and other states further east. Some of that oil is going to get shipped to the West Coast.”
In the meantime, freshman film production major Dylan Flores told The Panther that he has been driving as little as possible in order to avoid having to pay so much for gas.
“I spend most of my money on buying groceries, eating out and other basic necessities,” Flores said. “Having to drop $100 for gas burns a huge hole in my pocket and limits the necessities I can buy.”
For those that can’t cut down on driving, habits like keeping the weight in a car light or keeping one’s foot off the brake can slowly help conserve fuel and cut costs at the pump.
During this difficult time, Newsom has emphasized the importance of conservation, stating that the state should shift its focus away from increasing crude oil production.
“One thing we cannot do is repeat the mistakes of the past by embracing polluters,” Newsom said. “Drilling even more oil only leads to even more extreme weather, more extreme drought (and) more wildfire.”