In California, Astronomical Gas Prices Spur Career Changes
Residents of California are facing tough decisions as the average price of gas nears $6.00 (that’s about $1.50 higher than the national average). As reported Monday, fuel prices in the Golden State are expected to remain high as the rest of the nation starts to experience relief.
Factors contributing to the increase include:
- State emission regulations
- High state taxes
- Backlogs in the issuance of production permits
- A gas surcharge implemented following an explosion at an ExxonMobil refinery in 2015
- Russia’s invasion of Ukraine
California is also a “fuel island,” meaning that it does not receive gas through interstate pipelines but rather imports most of its oil from other countries. Efforts by lawmakers to remove the state’s gas tax were defeated by Democrats last week.
Richard Martin, a California resident and longtime Uber driver with a 5-star rating and more than 12,500 rides under his belt, is considering getting his CDL so he can switch to long-distance trucking. “You really can’t make a living too well with Uber, and now with the gas prices going out of sight, it’s become even less lucrative than it was,” says Martin, adding that he would love to purchase an electric vehicle (EV) if he could afford it.
EVs remain out of reach financially for most working class citizens despite the thousands of dollars in rebates offered by the state of California and the federal government. Uber and Lyft recently added a $0.50 fuel surcharge to mitigate the increased costs, but surveys suggest more than 50% of drivers have already quit or are driving less.
When President Biden confirmed the US would ban imports of Russian oil earlier this month, he describing the expected jump in prices as “Putin’s price hike.” Speaking in Fort Worth, Texas, he confirmed gas prices are “gonna go up” but added that we “can’t do much right now – Russia’s responsible.”
Some officials worry the ban will do more harm than good, considering Russia sent just 1% of its oil exports to the United States in 2020. European nations, which receive 50% of Russia’s oil exports, have resisted the call to ban imports.