Below are the monthly updates from the most current 2022 fuel price data (GasBuddy.com) and February 2022 electricity and natural gas price data (US Energy Information Administration). To view additional data and analysis related to the California economy visit our website at www.centerforjobs.org/ca.
The latest data continues to reflect the increase in crude oil and natural gas prices, with the 2nd highest gasoline prices on record in California. More troubling for inflation prospects, diesel—a critical fuel for food production and delivery of goods and services—prices continued rising to their highest.
The most recent data from CSAA show little change from the April averages. The most recent average price in California for regular gasoline on May 5 is slightly higher at $5.76, up from $5.69 a week ago. US prices show a slightly higher rise at $4.25, compared to $4.14 a week ago.
The steep and currently sustained rise in fuel prices has led to a number of relief proposals at both the federal and state level, although the previous proposals in California now appear to have been put on hold after failing to meet the required deadline. Additional proposals are likely, and a number of federal proposals continue to be considered due to the high concern over the effects of fuel prices on household disposable incomes as well as growing inflation.
A core difference, however, is that California households have already been through the fuel price increase now being felt in the rest of the country. The following chart shows average gasoline prices in California compared to the rest of the US for comparable 12-month periods running from May to the latest data in April. As shown, the price trend households and employers in the other states faced in the current (2021-22) 12-month period is essentially the same those in California were subjected to in the previous (2020-21) 12-month period. The cost surge that is now raising understandable alarms at the federal level is something Californians have already been through without any comparable calls for relief from the state or reviews of the policies that produced it.
A more relevant key difference likely lies in why those alarms are being raised. The current surge in prices is the result of global market disruptions caused by actions by Russia. The 2020-21 experience in California and at least a portion of the most recent results are the result of actions by state policy and regulations that chose to increase fuel costs to Californians with little to no consideration of the eventual effects to the costs of living and the costs of doing business.
As global markets stabilize, the rest of the country is likely to see prices return to at least some approximation of normal. California’s policies and regulations, however, will keep prices well above the recent national peaks behind the calls for action in Washington and likely continuing to climb even higher.
To view the full report, click here.