California hit by gas shortage, high prices

Joshua Falk / Bloomberg News /

SAN FRANCISCO — Gasoline station owners in the Los Angeles area are beginning to shut pumps because of supply shortages that have driven wholesale fuel prices to record highs.

Costco’s outlet in Simi Valley, 40 miles northwest of Los Angeles, ran out of regular gasoline Wednesday and was selling premium fuel at the price of regular, Jeff Cole, Costco’s vice president of gasoline, said by telephone. The company hasn’t been able to find enough unbranded summer-grade gasoline to keep its stations supplied, he said.

The gasoline shortage “feels like a hurricane to me, but it’s the West Coast,” Cole said. “We’re obviously extremely disheartened that we are unable to do this, and we’re pulling fuel from all corners of California to fix this.”

Spot, or wholesale, gasoline in Los Angeles climbed 30 cents to $1.45 a gallon over gasoline futures traded on the New York Mercantile Exchange, data compiled by Bloomberg show. That’s the highest level for the fuel since at least November 2007, when Bloomberg began publishing prices there. The premium has surged $1 this week. On an outright basis, the fuel jumped to $4.3396 a gallon.

Gasoline at the pump gained 8.3 cents to $4.315 a gallon in California Wednesday, according to AAA.com, 53.1 cents more than the national average of $3.784. In Los Angeles the price was $4.347.