California's Average Gasoline Price Hits 28-Year Low
When adjusted for inflation, the average price of gasoline in California has dipped to its lowest level in 28 years, the California Energy Commission reported today.
The average price for a gallon of gasoline in 1970 was $0.34, according to Commission figures. When adjusted for inflation, the price of 28 years ago equals $1.27 in today's dollars.
In comparison, the statewide average price for California unleaded reformulated gasoline as of March 2 dropped to $1.10 a gallon, from a high of $1.44 a gallon in mid-September last year. Some stations in Los Angeles County are even cutting prices below $1.00 a gallon for the first time since December of 1991.
Prices may even tumble even lower for the next few weeks, according to the Energy Commission. One of the reasons is high reformulated gasoline inventories, caused by Californians driving less during this year's El Niño storms. Other factors include a glut in world oil markets; the possibility of Iraq exports doubling in the months to come; a weakened Asian demand for petroleum products; and milder winter weather in the northern hemisphere which has reduced the demand for heating oil. Expect prices to rise by the Memorial Day weekend, however, when demand traditionally increases for the summer driving season.
Although the average gasoline price in the state has fallen, Californians still pay one of the nation's highest gas prices, in part because excise and sales taxes are higher than in most states. Oil companies also pass on to consumers their expenses in producing cleaner burning gasoline to meet more stringent environmental laws.
The Energy Commission also said gasoline prices in the Los Angeles area are lower than in Bay Area communities because competition among retailers is more fierce down south. Southern California is a major refinery center, and there are more gas stations per square mile and per customer. The cost of doing business is less because real estate is cheaper and available sites for gas stations are more plentiful. In addition, local sales taxes, which are a part of the pump price of gasoline, vary throughout the state and can influence the cost per gallon.
Meanwhile, Commission figures based on taxable sales reported to the Board of Equalization point to Chevron as the number one retailer of gasoline in California. Total taxable sales reported for the period covering January to November 1997 showed Chevron dominating the big distributors with a 19.6 percent share of the market. Here is the breakdown of California gasoline sales:
RANK COMPANY % SHARE
1. Chevron 19.6 2. Atlantic Richfield Company 19.1 3. Tosco Refining Company 17.8 4. Shell 11.8 5. Mobil Oil 9.4 6. Exxon 7.2 7. Ultramar 7.1 8. Texaco 5.6 9. Others 2.4
Tosco's sales numbers included those of Union Oil of California, which it purchased in March of 1977. The category other includes independent refiners, marketers, bulk purchasers and retail operators.
For additional gasoline information, visit the Energy Commission's Web site at:
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