Fourth of July gas prices in California and nationwide reach lowest levels in three years

As millions of Americans prepare to hit the road for the Fourth of July weekend, they will be happy to know that gas prices nationwide and in California are the lowest they have been in three years.

The average price of a gallon of gas on July 4 in California this year was $4.79, slightly down from the previous year of $4.84 and more than a dollar down from $6.24 in 2022.

The two-year drop is a natural recovery from the 2022 spike caused by the war in Ukraine, said Marie Montgomery, an Automobile Club of Southern California spokesperson.

After Russia invaded Ukraine in February 2022, the U.S. introduced sanctions on Russian oil, raising gas prices across the country.

The nationwide average on July 4 after the Russian invasion was $4.81, up 54% from the previous year. This July 4, it fell to $3.51.

Gas prices are seen at a gas station in Buffalo Grove, Ill., Tuesday, April 23, 2024.

Gas prices are seen at a gas station in Buffalo Grove, Ill., on April 23, 2024.

(Nam Y. Huh / Associated Press)

“The worldwide concern about oil supply evened out and [when] American production of oil increased in 2023, we saw more of a return but not quite to the level of 2021,” Montgomery said.

Despite the recent decline, Fourth of July gas prices remain about 50 cents higher in California and 40 cents higher nationwide compared to 2021, according to the automobile club.

Montgomery pointed to a multitude of factors for the slow cool-down, including inflation and an increase in gas taxes.

California has the highest state tax on gas in the country, which has more than doubled since June 2017, according to the California Taxpayers Assn.

The state’s excise tax on gas increased from 57.9 cents per gallon to 59.6 cents per gallon on July 1. 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 fewer than 400,000 barrels of crude oil a day, only a third of what it used to produce in 1985 at 1.1 million barrels a day.

“There’s a lower capacity in the state to produce gasoline as a lot of the refineries are going toward producing other green fuel such as clean diesel,” she said.

While Fourth of July gas prices have yet to return to what they were before 2022, motorists will still be able to pay less for gas this holiday weekend compared to the last two years.

The American Automobile Assn. projects a record 60.6 million Americans will travel by car over the Fourth of July week from June 29 to July 7, up 5% from the previous year.

Los Angeles is among the cities with the highest rental car demand over this 10-day period, according to Hertz.

Drivers in Southern California can expect peak congestion from Bakersfield to Los Angeles via the 5 Freeway southbound on Monday, July 8, according to the AAA.

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