LOS ANGELES – Gasoline prices in the Los Angeles region have reached as high as $5 a gallon, and many expect that the daily double-digit increases that began last week could continue at least a few more before retreating. Statewide, the average price for a gallon of regular gas stood at $3.72, with the average Los Angeles-area price at $4.05.

The Los Angeles Times reports that prices have risen 50 cents a gallon from a week ago in the Los Angeles-Long Beach region, due largely to a shortage of refined petroleum. A local Tesoro plant recently reduced its refining capacity in order to perform maintenance, a slow-down that followed February’s decreased production due to a worker strike. A local Exxon Mobil refinery has also scaled back operations after an explosion in February damaged an air pollution monitoring unit.

“The California market is always challenging for both the industry and consumers,” explained Fuels Institute Executive Director John Eichberger. “While the market seems to be stabilizing, California’s unique environmental requirements and limited supply options mean that any type of disruption has the potential to disproportionately affect the market.”

Essentially, California is a market unto itself, when it comes to fuel prices, which are already driven up by about 70 cents per gallon in taxes and fees. Few refineries outside the state are equipped to produce California gasoline, so any interruption of capacity at the state's refineries has an outsized effect on supply — and prices.

Last week, the U.S. Energy Information Administration released a report saying there was a lack of fuel imports to California and wholesale prices quickly jumped, at least temporarily. Experts expect the Exxon Mobil refinery to return to full operations in the next month, ushering in greater supply and accordingly lower prices.

“For retailers, price spikes are typically very costly – from a substantial drop in per gallon profits to damaged relations with their customers,” explained Eichberger. “Everyone is anxious for supplies to return to a stable condition as quickly as possible.”