DRIVERS are being warned to brace for a brutal gas hike that could leave them shelling out more than $8 for every gallon.
A new report predicts a staggering 75% spike in prices by the end of 2026, hitting wallets across one state in particular.
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The report centers on California, where the upcoming closure of two major oil refineries is expected to slash fuel production.
The shutdowns involve the Phillips 66 refinery in Los Angeles and Valero’s facility in Northern California.
Together, the two closures represent a 21% drop in the state’s oil refining capacity over three years, CW local affiliate KTLA reported.
The bombshell forecast comes from USC’s Marshall School of Business and was authored by Michael A. Mische.
“The estimated average consumer price of regular gasoline could potentially increase by as much as 75% from the April 23, 2025, price of $4.816 to $7.348 to $8.435 a gallon by calendar year end 2026,” Mische wrote.
“We can expect retail prices to be even higher in counties such as Mono and Humboldt.”
California consumes more than 13.1 million gallons of gasoline each day, according to the report.
But the state only produces just under 24% of the crude oil it needs.
This means with the upcoming refinery closures, California could face a fuel shortfall of up to 13.1 million gallons daily.
Lawmakers are now pressing Governor Gavin Newsom to intervene and stop the shutdowns.
“If the Governor doesn’t act now, Californians will be blindsided by sticker shock at the pump and skyrocketing prices on everyday goods,” said Senate Minority Leader Brian W. Jones.
“We’re talking about gas prices over $8.43 per gallon by the end of next year.”
Some counties, especially rural ones, are expected to suffer even more due to transportation and supply issues.
‘CRITICAL ISSUE’
The letter from lawmakers urges Newsom to immediately halt the closures and explore alternatives.
The governor’s office, however, is pushing back on the report’s warnings.
“Just last month, the governor directed the state to redouble efforts to work with refiners to ensure a safe, affordable and reliable supply of gasoline,” said Daniel Villaseñor, a spokesperson for Governor Newsom.
“We thank Senate Republicans for highlighting the administration’s work on this critical issue.”
“Governor Newsom will keep fighting to protect Californians from price spikes at the pump,” he added.
The report warns that ripple effects could spread beyond gas stations.
Higher fuel prices typically lead to increased costs for groceries, goods, and services across the board.
With fewer refineries operating, California could become even more dependent on out-of-state and foreign fuel imports.
That dependence could make the state even more vulnerable to global price swings and supply chain disruptions.
Drivers already paying some of the highest gas prices in the nation may soon see those numbers soar even higher.
Governor Newsom Statement
“Just last month, the governor directed the state to redouble efforts to work with refiners to ensure a safe, affordable and reliable supply of gasoline.
We thank Senate Republicans for highlighting the administration’s work on this critical issue. Governor Newsom will keep fighting to protect Californians from price spikes at the pump.”
Spokesperson for Governor Newsom in a statement to KTLA
