SAN FRANCISCO—On March 12, 2026, a Shell gas station in the South of Market on 4th Street and Bryant Street had prices reaching to $6.50 per gallon, nearly $1.00 higher than the city average.
On Saturday, March 22, 2026, the California Division of Petroleum Market Oversight launched a price-gouging investigation after several gas stations began charging over $8 per gallon after conflict in the Middle East started. On Monday, March 24, a South San Francisco Shell gas station began charging nearly $7 per gallon.
On Sunday, April 5, 2026, diesel fuel prices officially went past $8 per gallon in San Francisco, the highest price recorded for any fuel type in United States history.
On Tuesday, July 1, 2025, California gas tax was the highest in the nation. It has a total excise tax of $61.2 cents per gallon, which is adjusted annually for inflation on Tuesday, July 1 as part of the Road Repair and Accountability Act of 2017 (Senate Bill 1). According to gas tax and fee data from mid-2025 to early 2026, total tax burden on California drivers, which includes federal excise tax at $0.184, state sales tax and $0.02 cents per gallon levied underground storage tank maintenance fees, it is closer to $0.90 cents per gallon.
Due to tensions from Iran, there was a disruption in oil supply by way of the Strait of Hormuz, which caused oil to surpass $100 per barrel. According to Dr. Severin Borenstein, director of University of California at Berkeley Energy at Hans, an expert in the gas industry, gas prices increase is tied to the tightening in global oil supplies because 20 percent of all world’s oil is coming out of the Persian Gulf
California lost 20 percent of its refining capacity since October 2025. It left the state vulnerable to supply shocks. High state taxes, environmental programs, which include the “cap-and-invest” and the unique California fuel blend called the Low Carbon Fuel Standard add to an estimated $0.17 and $.025 respectively for over $1 per gallon compared to other states.
