(The Center Square) – Thanksgiving travel is hitting Washingtonians harder at the pump this year than last November, as state tax increases and a slowing economy cause some to reconsider staying home.
While the average gasoline price in Washington has dropped 16 cents since last month, from $4.34 to $4.18 per gallon, it’s still 18 cents more than last Thanksgiving, according to AAA. Meanwhile, millions of people are hitting the road, increasing the estimated travel time from Seattle to Bellingham by 77%.
The average price nationwide sits at about $3.04, around 2 cents lower than last Thanksgiving. Earlier this year, Democrats increased the state gas tax by 6 cents to help overcome a deficit. Next July, the tax will begin rising by 2% annually, driving up the prices of groceries and other products with it.
“Drivers have grown more resilient to price swings, yet I worry that concerns about a cooling economy may be weighing on Americans,” Patrick De Haan, head of petroleum analysis at GasBuddy, wrote in a news release. “Even with affordable gas, economic uncertainty can make people stay closer to home.”
De Haan said even though the average price nationwide is holding steady, it’s not translating to more travelers, let alone for one of the states with the highest gas prices in the country. According to AAA, Washington ranks third for the most expensive gas in the nation, right behind California and Hawaii.
Following the Evergreen State are Nevada, Oregon, Alaska, Arizona, Pennsylvania, Idaho and Illinois. If someone drove the few minutes from Spokane across the state line to Idaho, they could see prices dip nearly $1. That may not amount to much now, but the gap could widen by 2% annually if prices hold.
“Every year without any change in the price of oil, Washingtonians are going to have to pay 2% more, and it might be closer to 2.5%, because that additional tax also reduces the purchasing power, which causes inflation in and of itself,” De Haan said in an interview with The Center Square on Wednesday.
He attributed the state’s position as having one of the most expensive gas prices in the nation to the Climate Commitment Act. The CCA sets a declining cap on emissions for the state’s largest polluters, requiring them to purchase “allowances” at quarterly auctions to offset their environmental impact.
Oil refineries respond by raising gasoline prices, which in turn drive up prices at the grocery store and other businesses due to higher trucking costs. De Haan said the CCA caused fuel prices to rise almost immediately, despite former Gov. Jay Inslee arguing that it would only amount to pennies.
De Haan said the more recent increases in gas prices are due to regulatory conditions across the West Coast, as refineries consider leaving the region because of the political climate. He said gas shipments are on the way from overseas to provide some relief, though 2% annual gas tax hikes still loom.
Issues with the Olympic Pipeline slowed down relief, as the shutdown requires around 1,300 truckers daily to transport the oil that the infrastructure routes along the West Coast, he said. De Haan thinks that once everything is back to normal, the state’s average gas price could drop below $4 per gallon.
“Washington state, given the fact that it’s a cap and trade state, is now likely going to be inked in as a permanent resident of the top five gas prices in the country,” De Haan told The Center Square.
