(Bloomberg) -- Alaskan oil price premiums are surging as competition to replace Russian crude on the U.S. West Coast heats up, threatening California drivers with even higher fuel prices.
Alaskan North Slope crude, or ANS, traded at the largest premium to Nymex oil futures since February 2019, according to data compiled by Bloomberg. Demand from the U.S. West Coast, historically the biggest importer of Russian oil, is picking up as regional fuelmakers are running at their hardest in about seven months to prepare for summer, when gasoline consumption typically peaks.
The jump in ANS prices, a key feedstock for California's refineries, doesn't bode well for Golden State drivers who are already paying more at the pump than anywhere else in the country. Gasoline in California rose to an all-time high this year after oil prices surged in the wake of the U.S. ban on Russian crude.
Why Some Californians Are Paying $6.95 for a Gallon of Gasoline
“California drivers are looking at even higher prices this summer,” said Zachary Rogers, Rapidan Energy's director for refining and biofuels. “Maybe even close to $8 a gallon if crude prices stay above $100 a barrel or should refiners not operate at full throttle.”
ANS is also likely getting support after Saudi Arabia raised prices for its crude to record highs, prompting buyers of that crude to seek alternatives.
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