Diesel prices experience an upward trend following a run of five consecutive weekly drops.
California's diesel prices have surged to their highest spread against the national average since June 16, reaching $1.18 per gallon. This increase, published on Wednesday, comes after a period of relative stability following a price jump of 20.4 cents per gallon on June 23, 2025.
The latest surge in prices marks the first increase since a 5.4 cents per gallon hike on July 21, 2025. The highest price during the 10 weeks following the June 23 price was $3.812 per gallon, reached on July 21. The lowest price was last week, at $3.708 per gallon.
The rise in prices has been a cause for concern among California officials, who are already grappling with the closures of the Phillips refinery and Valero refinery in the San Francisco bay area. The closure of the Phillips 66 refinery complex in the Los Angeles area, which has a capacity of 139,000 barrels per day, is expected to begin soon.
The shutdown of these refineries has raised concerns about potential impacts on prices and the possibility of driving other refineries out of the state. Regulators have put on hold a plan to place a cap on refining profits in California, as they monitor the situation closely.
Meanwhile, Brent, the world's crude benchmark, did not settle above $70 per barrel in August. It opened September by rising to a settlement at $69.14 per barrel, but then dropped to $67.50 per barrel on Wednesday due to expected OPEC+ authorization to put more oil on the market.
Despite the recent price surge, it's important to note that the California diesel price differential over the national figure is currently more than it was a year ago but less than two years ago. Three years ago, the California diesel price differential over the national figure was $1.09 per gallon.
The weekly Department of Energy/Energy Information Administration average weekly retail diesel price increased by 2.6 cents per gallon to $3.734 per gallon, according to the latest report.
Reuters reported that the shutdown operations at the Phillips 66 refinery in the Los Angeles area are expected to begin soon. As the situation unfolds, California officials and industry experts will be closely watching the impact on diesel prices and the state's energy market.
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