Some claim latest gas price spike caused by oil industry

ALAMEDA, Calif. (KTVU) -- The average price for a gallon of gas in California has gone up nearly 30 cents in the past few days, leading some to raise accusations of a manipulated price spike by the oil industry.

In the U.S. gasoline prices have been trending down or nearly flat currently average $2.77 for a gallon of regular, but L.A. prices are a whopping $4.05 a gallon, rising by half a buck in just five days.

Because the L.A. market is so large, California's average price is $3.72 a gallon, 29 cents a gallon higher than five days ago.

Despite low crude oil prices worldwide, the oil industry says oil is in short supply right now and the chemicals needed to brew California's special clean air formula are in short supply as well. Consumer Watchdog is having none of that explanation, calling it market manipulation.

"And they're actually exporting gasoline, largely from Southern California, down to Mexico, Central America and South America," said Jamie Court of Consumer Watchdog. 

On Monday, Bay Area regular averaged $3.53 a gallon; 11 cents higher than just five days ago.

But with southern California refineries looking for and willing to pay higher prices for crude oil, price spikes could quickly come to the Bay Area.

"Shipments by tanker are the main source of crude oil into California and they will change the destination of a tanker if the price differential warrants it," said Professor Severin Borenstein, an energy economist at the UC Berkeley Energy Institute at Haas School of Business. "Is that just something that's just a series of natural problems which, in itself we need to address by changing the way our gasoline market works? Or, it is actually being exacerbated by opportunistic behavior by some of the sellers?"

Drivers KTVU met at a Shell station Monday have few choices but to grin and bear it or buy an electric car.

"I think they are just accepting whatever it is because of demand. You cannot drive without gas, right?" asked Ail Ince.

"I notice it. I mean a $70 gas bill in my car is a very big difference that a $50 one," said Robert Shepherd.

"I don't pay too much attention, but I do notice like when it heavily increases," said Nina Nasre.

But Professor Borenstein told KTVU this is a short-term problem that should be relieved fairly quickly. 

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