Gas prices are down, even on the West Coast: AAA

Gas prices across the nation dipped slightly last week. For Californians, the drop was more pronounced as a period of tight oil inventory that pushed their prices higher came to an end, according to AAA.  

The national average price of gas fell to $3.76 per gallon, three cents less than the week before. In California, prices dropped by 85 cents from their peak in early October, although they still remain higher than the national average. 

The West Coast's falling average gas price "has taken pressure off the national average price," AAA said. 

"The recent period of tight oil inventory pushing prices higher on the West Coast is over as regional refineries completed needed maintenance," Andrew Gross, a spokesperson for AAA, said. "Fluctuating oil prices and low demand contribute to the national average prices moving downward." 

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Volatility in crude oil prices helps keep prices down

Along with improving conditions on the West Coast, lower demand for gas and "waffling global oil prices" are likely to keep prices lower at the pump, AAA said.

U.S. West Texas Intermediate (WTI) crude fell from $1.18 to $87.90 at the close of Friday’s formal trading session, according to AAA. 

"A lower dollar contributed to price increases earlier last week; however, market concerns about global crude demand, after China announced more COVID lockdowns, sent prices lower at the end of the week," AAA said.  "For this week, persistent market concerns that economic growth will stall or decline, alongside decreased crude oil demand, could put downward pressure on prices."

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Biden administration targets oil companies

On Monday, President Joe Biden said that he may tax oil and gas companies if they don’t use their record-setting profits to lower costs for Americans and increase production.

Biden said that if these companies passed the record $100 billion in profits they've earned over the last six months on to consumers, gasoline prices would be down by about an additional 50 cents.

"But rather than increasing their investments in America or giving American consumers a break, their excess profits are going back to their shareholders and to buying back their stock, so the executive pay is going to skyrocket," Biden stated.

If oil and gas companies don’t increase production, Biden said he would work with Congress to examine ways to make the companies "pay a higher tax on their excess profits and face other restrictions," he said.   

Last month, Biden announced the release of an additional 15 million barrels of oil from the emergency reserve, saying it would lower gas prices and bolster domestic oil production. The decision is part of the administration's 180-million-barrel drawdown that was announced this past spring. 

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