Gasoline prices are soaring in California as refinery and pipeline disruptions reduce supplies and cause some gasoline providers to ration sales.
Retail gas prices in the Golden State were 53.1 cents above the national average this week, hitting an average of $4.49 cents. The record price per gallon in California is $4.61. However, some stations are charging almost $6 a gallon as supplies dwindle, Bloomberg noted.
Discount gas retailers like Costco (NASDAQ:COST) have run out of gas supplies in some locations.
A Torrance, California, refinery, owned by Exxon Mobil suspended operations this week after a power loss. The temporary production stop comes after a Chevron (NYSE:CVX) pipeline had to be shut down last month. Additionally, two Phillips 66 (NYSE:PSX) refineries are schedule for repairs this month.
California has imposed strict gasoline blending rules in a bid to lessen the environmental impact of vehicle emissions. Those rules make it extremely difficult to import gasoline from other states where blending requirements are less stringent. The state is also outside the network of fuel pipelines that connect states in the rest of the country.
That leaves the state vulnerable to sharp price swings during refinery problems.