Below are the monthly updates from the most current September 2025 fuel price data (GasBuddy.com) and July 2025 electricity and natural gas price data (US Energy Information Administration). To view additional data and analysis related to the California economy visit our website at www.centerforjobs.org/ca.

California had yet another reminder of the potential consequences arising from its regulatory isolation from the broader US and world fuel markets when a fire broke out last Friday at Chevron’s El Segundo Refinery.  According to Energy Commission data, this facility represents about 17% of the state’s current gasoline and diesel production capacity.  Following completion of the two announced refinery closures, El Segundo will account for about 20%.

The effect on Southern California and state fuel prices remains uncertain, and will depend on the length of time units at the facility remain shut down for inspections and repairs, current inventories (up to date reporting remains on hold due to the federal shutdown), and whether any of the other refineries remaining in the state experience any unscheduled stoppages in this period.  Price effects to date mainly have affected jet fuel—the primary unit reported to be affected by the fire—with prices spiking 33 cents a gallon on Friday.

Prices for other fuels have yet to show major changes.  Using the CSAA daily fuels prices, the overall US average for regular gasoline dipped 4.1 cents gallon since Friday, while showing only incremental rises of 1.6 cents for California, 0.5 cent for Los Angeles-Long Beach MSA, and 4.3 cents for San Francisco MSA.  Diesel dipped 2.5 cents for the US, 0.1 cent for California, 0.5 cent for Los Angeles-Long Beach, and 1.6 cents for San Francisco.

Most analysts expect any subsequent price effects to be low to moderate.  Market analyst Patrick De Haan has lowered his price forecast to a potential rise of 10 to 35 cents a gallon affecting California, Arizona, and Nevada over the next 1-2 weeks.  More limited effects are likely for Northern California, Oregon, and Washington, although spot prices in the later two areas were up on Tuesday. On Wednesday, however, De Haan is reporting a significant decline in wholesale prices that should staunch additional price increases in Southern California, Oregon, and Washington.

In the latest data, California remains the most costly among the contiguous states and DC for fuels and electricity rates, while also remaining near the top on natural gas rates.  California’s rank for average annual electricity bill saw some easing as some states have begun see rising price pressure coming from their adoption of California’s renewable energy policies and as residences have pulled back on electricity use due to its high cost.

In September, total average LCFS charges incorporated in the price Californians pay for fuel eased 4 cents for gasoline but rose 2 cents for diesel, while the Cap & Trade component rose 2 cents for both fuels as credit markets continued to rise following reauthorization of the program.  Cap & Trade costs continued to rise in the first week of October, while LCFS remained largely stable.

The costs shown in the table are for the penultimate month-to-date numbers from the OPIS Carbon Market Report, adjusted to incorporate state and local sales tax to account for the full additional costs imposed by these regulatory fees on fuel buyers.  Certain Data or Information Provided By: Oil Price Information Service, LLC. Distribution of OPIS data without permission from OPIS is prohibited.

Combining the OPIS data (without the sales tax component) with the previous Energy Commission estimates, Cap & Trade costs are now showing a gradual rise as activity on the program’s extension has increased, while LCFS costs which had been easing before June have reversed course under the new regulations.  That apparent easing, however, appears to be due to confusion surrounding the Air Board’s release of the amended regulations, as discussed below.  Note that both charts include both the Cap & Trade components charged at the rack and levied on production from the OPIS data, and only the rack component in the Energy Commission data.

The less-than-expected rise in LCFS has at best provided some breathing room for these regulations, although as we have discussed in prior months, the full cost impact to households and employers has been delayed in particular by the substantial inventory of banked credits.  As shown in the chart below, some 40-plus million banked credits have placed substantial downward pressure on credit prices, resulting in prices (4-week moving averages) largely remaining level in the first three introductory months of the regulations.  

The apparent lower effect to date also appears to be the result of mixed information provided by the Air Resources Board earlier this year.  As reported, after OAL rejected the Board’s regulation package last November, early indications were that the revisions would be turned around and the amended LCFS regulations would be applied retroactively beginning in January 2025.  OPIS began reporting the new LCFS values accordingly, and it appears that these costs began being priced into the cost of fuels in January.  The regulations eventually were released later in the year, becoming effective as of July.  After the Board announced this new schedule in mid-May, OPIS adjusted their pricing calculations.

As shown in the chart above, the LCFS amendments have had a significant effect on fuel prices, it just occurred in January rather than as expected in July due to incomplete information coming from the Board.  And as the banked credits drop due the higher required usage under the amendments, credit prices and the LCFS cost component are likely to face an upward trend towards the pre-2023 levels.

Average prices ($ per thousand cubic feet; 12-month moving average) for the 12 months ended July 2025 and changes from the previous 12-month period for each end user: