Not really a "mystery" for those of us that have lived in California long enough

[theking]

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The mystery lurking in California’s $8 gas prices
The Golden State has a ‘mystery gas surcharge.’ Some say it’s price gouging.



Eight dollars for a gallon of gas. Once, it seemed like an impossibility; now, it seems to happen in California every time there is a price spike. Last week, a Chevron station in Los Angeles recorded prices of $8.35 and above; similar prices were reported at multiple stations around Southern California.

But some analysts say the most recent spike in California prices — the average price per gallon across the state as of Tuesday was $6.29 — is only part of a much longer, and potentially more destructive, trend. For the past seven years, California consumers have suffered through what one economist calls a “mystery gasoline surcharge.” That is, California gas prices are significantly higher than in the rest of the nation — and the price premium can’t be explained by state taxes and environmental regulations alone.

Severin Borenstein, a professor of business and public policy at the University of California at Berkeley, first noticed the separation between the state’s gas prices and the rest of the nation in 2015. An ExxonMobil oil refinery operating in Torrance, Calif., had just exploded, and the interruption to gasoline refining explained the temporarily higher prices. But over the following months and years, Borenstein says, the difference never disappeared as he expected.

“It went up, and it never came down again,” he said.

California does have additional taxes and fees from environmental regulations that other states don’t have. The state’s low carbon fuels standard, for example, adds $0.08 to every gallon of gas. California gas taxes add another $0.17. But Borenstein’s data shows that, all told, California-specific taxes and regulations only account for around $0.83. In September, however, the average Californian was paying $1.57 more for gas than the average American, leaving a large “unexplained” surcharge. That’s a big gap — and in October, it could get even bigger.