As millions of Americans prepare to hit the road this Fourth of July weekend, they'll be happy to know that gas prices across the country and in California are the lowest they've been in three years.
The average price of a gallon of gasoline on July 4 in California this year was $4.79, down slightly from $4.84 last year and more than a dollar below $6.24 in 2022.
The two-year decline is a natural recovery from the 2022 spike caused by the war in Ukraine, said Marie Montgomery, a spokeswoman for the Automobile Club of Southern California.
After Russia invaded Ukraine in February 2022, the United States introduced sanctions on Russian oil, which increased gas prices across the country.
On July 4, after the Russian invasion, the national average price was $4.81, up 54% from the previous year. On July 4 this year, the price dropped to $3.51.
Gasoline prices are seen at a gas station in Buffalo Grove, Illinois, on April 23, 2024.
(Nam Y. Huh/Associated Press)
“Global concerns about oil supplies have stabilized and [when] “US oil production increased in 2023, we saw a higher return, but not exactly at the level of 2021,” Montgomery said.
Despite the recent drop, Fourth of July gas prices are still about 50 cents higher in California and 40 cents higher nationally compared to 2021, according to the automobile club.
Montgomery pointed to a multitude of factors for the slow cooling, including inflation and rising gasoline taxes.
California has the highest state gas tax in the country, which has more than doubled since June 2017, according to the California Taxpayers Association.
The state excise tax on gasoline increased from 57.9 cents per gallon to 59.6 cents per gallon on July 1. The excise tax on diesel fuel increased from 44.1 cents per gallon to 45.4 cents per gallon.
Drivers must also pay a federal excise tax of 18.4 cents per gallon.
Montgomery also cited a gradual decline in oil refineries and oil production in the state. California produces less than 400,000 barrels of crude oil a day, just one-third of what it used to produce in 1985, 1.1 million barrels a day.
“There is less capacity in the state to produce gasoline as many of the refineries are shifting to producing other green fuels such as clean diesel,” he said.
While Fourth of July gas prices are still not back to what they were before 2022, motorists will still be able to pay less for gas this holiday weekend compared to the past two years.
The American Automobile Association projects that a record 60.6 million Americans will travel by car during the week of July 4, June 29 through July 7, up 5% from the previous year.
Los Angeles is among the cities with the highest demand for rental cars during this 10-day period, according to Hertz.
Drivers in Southern California can expect peak congestion from Bakersfield to Los Angeles via the southbound 5 Freeway on Monday, July 8, according to AAA.
