Gasoline prices, on average around the nation, have declined over the past week, but refinery issues have lifted prices in California past $4 a gallon for the first time in nearly four months.
The week’s pullback in prices follow an attack on Saudi Arabian oil facilities on Sept. 14 that briefly disrupted more than half of the kingdom’s daily output. Saudi Aramco says that it has restored capacity to the levels seen before the attacks, the chief executive officer of the state-owned giant’s trading arm said on Monday, according to The Wall Street Journal. The WSJ report said Saudi officials and advisers last week pegged Aramco output at 9.8 million barrels a day, which was roughly the same level as before the attacks.
Against that backdrop, the average national price for regular unleaded stood at $2.637 a gallon late Monday morning, down 2.4 cents from the week-ago average, according to GasBuddy.
“Oil prices have cooled back off after Saudi Arabia brought a significant portion of oil production and processing back online, helping the national [gasoline-price] average to begin moving lower again,” said Patrick DeHaan, head of petroleum analysis at fuel-price tracker GasBuddy.
U.S. benchmark November West Texas Intermediate crude CLX19, -1.68% traded at $55.23 a barrel in Monday dealings, up 0.6% for the month, but down 5.2% for the quarter. Global benchmark Brent crude BRNZ19, -1.74% saw its December contract, which will be the front month at the session’s end, at $60.28, up 3.1% for the month, though poised for a quarterly loss of 5.5%.
Average monthly regular gas prices for California
Gasoline prices in California, however, saw a “massive spike” of around 25 cents a gallon in the last week, fueled by refining issues, said DeHaan.
In California prices were at $4.015 a gallon late Monday morning, up 25.9 cents over the last week. The highest average for this year was $4.121 a gallon on May 8 of this year, while the all-time California gas price record was $4.67 a gallon back in late summer 2012, according to GasBuddy data.
Four California refineries are “affected by various unexpected downtime” are Chevron Corp.’s CVX, -0.03% in El Segundo, PBF Energy Inc.’s PBF, +1.70% in Torrance, Phillips 66’s PSX, -0.82% in Rodeo and Valero Energy Corp.’s VLO, +1.42% in Benicia, DeHaan told MarketWatch.
While most of the country will likely see prices “tip-toe lower as oil prices have moved lower,” California will “see prices move higher in the week ahead, with increases also possible in t hose areas that receive their gasoline from California—including Las Vegas,” he said.
If prices for the state rise by another 10 cents to 15 cents, they “may rival the highest level since 2014,” DeHaan said.
Still, he told MarketWatch that he believes most of increase to the California gas price will wrap up early this week and by this weekend, “we’ll see prices stabilize for now—barring additional issues.”