Gas prices have gone up almost 8¢ since the 14th ... a heart breaking price hike that makes this the most expensive February on record for gasoline in California history. The current average is now $4.27.
Right now we're experiencing one of the fastest climbs in gas prices ever and the question that has everybody worried: "Is this climb going to stay up there?" The initial start of this climb was contrary to the normal market mechanics and unrest in the US economy and world economic conditions were attributed to the increases. It's only recently that speculators have been getting involved as they have in the past.
Local gas prices surged 9¢ at the retail level today, reaching an average price of $4.09 a gallon in San Diego County.
Prices have increased 27¢ in the last 7 days, and almost 40¢ in the last two weeks, representing an 11% increase in less than 14 days.
Given the velocity of the current price trajectory, and the fact that it is occurring this early in the year, suggests that 2013 will probably be the most expensive year for gasoline in the history of the state of California.
A new analysis by UCAN, the Utility Consumers' Action Network shows that San Diego and California gas prices have exceeded the record high for any January in U.S. history.
"This could be the beginning of a possible superspike in gas prices," says UCAN's Gasoline Project manager, Charles Langley.
Gasoline currently averages $3.90 a gallon in San Diego -- The highest price ever for this time of year.
San Diego gas prices increased 3.3¢ a gallon since Monday, matching the rate of increase we saw during the entire month of December in 2012.
We predict that gas prices could climb as much as 5.5¢ a gallon by Monday, despite reports of healthy inventories of gasoline on the West Coast, and relatively stable oil prices.
On Monday morning, the market barely seemed to have a pulse. The three factors came into play:
On Thursday we predicted that gas prices would fall
another 8¢ by today (see last blog).
Today, our look at wholesale prices shows that despite
significant volatility on the wholesale level, gas prices will
continue to decline in Southern California.
We predict that prices will drop on average by 4 to 10¢
a gallon by the time we make our next prediction on Thursday.
Why Hurricane Sandy will help lower our gas prices
We've said it before: "Driving rain drives down gas prices."
And when a hurricane is in play, you can expect gas prices
to drop in the short term. In fact, we predict that in Southern
California, gas prices are likely to drop another 8¢ this weekend.
The primary reason is demand destruction: On the East
Coast, demand is down because so many roads are
Gas prices have dropped 20 cents on average in the last week,
but the average basket of wholesale prices that we track have
dropped by 54¢ a gallon. So why aren't retail prices keeping
The only thing preventing a price free-fall below $4 in the next
week or two are "sticky prices." This is the "Up like a rocket, down
like a feather" syndrome that Bill Lockyer referred to when he was
investigating gas prices as the Attorney General of the State of