Analysis: US West Coast EVs Grow, but Gas Prices Stay High


   
Kristina Davis
DTN Refined Fuels Market Reporter

   MIAMI, FL (DTN) - Even as electric vehicles become more common across the 
U.S. West Coast roads, gasoline prices in the region remain high, frustrating 
drivers who expected relief as demand for fuel begins to level off.

   New end-of-year data suggest gasoline consumption in parts of the U.S. West 
Coast is flattening. But the overall trend shows pump prices continuing to 
outpace their growth in much of the country, raising questions about whether 
the shift toward electric transportation is meaningfully reshaping the U.S. 
fuels market.

   U.S. West Coast gasoline averaged $3.851 gallon for the week ended December 
15, above the $2.895 gallon national average price for retail regular gasoline, 
Energy Information Administration (EIA) data showed. While that represented a 
10.5cts weekly decline for U.S. West Coast gasoline, it was still 6.6cts, or 
2%, higher than levels recorded in the same period a year earlier.

   In comparison, East Coast gasoline averaged $2.842 gallon for the week to 
December 15, down 5cts on the week, and 14.9cts, or 5%, lower on the year.

   The disparity in the U.S.  West Coast versus other regional gasoline pricing 
comes as California maintains its dominance of national sales of electric 
vehicles, or EV, classified by the state as Zero-Emission Vehicles (ZEV). 

   According to industry data compiled by Veloz and attributed to the 
California Governor's Office, Californians purchased 124,755 new ZEVs in the 
third quarter of this year, accounting for 29.1% of all vehicles sold in the 
state. That means that nearly 3 out of every 10 new vehicles registered in 
California are EV.

   Meanwhile, national ZEV sales of 438,487 units represent 10.5% of all 
vehicles sold in the country in the same quarter, according to Cox Automobile 
data, suggesting that only around one in 10 cars sold across the 50 U.S. states 
is EV.

   EV sales strong in 2025

   Approximately 22% of light duty vehicles sold in the first quarter of 2025 
were hybrid, battery electric or plug-in hybrid vehicles, up from roughly 18% 
in the same period last year, based on estimates from Wards Intelligence cited 
by the EIA. Growth has been driven largely by hybrid EV, while battery electric 
and plug in hybrid sales have remained relatively flat.
Despite that momentum, EV still make up a small share of the total vehicle 
fleet. In 2023, electric vehicles accounted for less than 2% of all registered 
light duty vehicles in the United States, EIA data showed. This is because new 
vehicle sales represent a fraction of the cars already on the road, changes in 
fuel demand tend to unfold gradually rather than all at once.
On the West Coast, those gradual demand shifts are colliding with a fuel system 
that has little margin for error. Several refinery closures in recent years 
have reduced regional capacity, leaving the market more vulnerable to outages 
and unplanned disruptions.

   Even modest supply issues can have an outsized impact on prices, said a 
market participant, noting that "the lack of redundancy has become one of the 
biggest drivers of elevated prices."

   California Fuel Specs Add Complexity

   California's unique fuel specifications further complicate the picture. The 
state requires a cleaner burning gasoline blend that cannot be easily replaced 
with supplies from other regions, limiting flexibility when disruptions occur. 
As a result, prices are high even when demand softens.
At the same time, California is investing heavily in accelerating the 
transition away from gasoline. The California Energy Commission, the lead state 
agency overseeing investments in electric vehicle charging infrastructure, is 
deploying up to $100 million annually through its Clean Transportation Program 
to support cleaner transportation and alternative fuels.

   The state has set goals of placing 1.5 million zero emission vehicles on 
California roads by 2025 and 5 million by 2030, reaching 100% zero-emission 
passenger vehicle sales by 2035, according to the CEC.
Those investments are reshaping long term demand expectations, but they also 
introduce new challenges for businesses caught in the middle. Gas station 
owners face tighter margins as fuel volumes soften, while refiners must balance 
declining demand against rising per gallon costs tied to compliance, 
maintenance and fewer operating assets. Thus, consumers are left paying higher 
fuel prices even as the region moves toward a less gasoline-dependent future.
Looking ahead to 2026, market participants say the U.S. West Coast fuel market 
is unlikely to see a sudden tipping point. Instead, the transition is expected 
to remain volatile, with EVs gradually chipping away at demand while supply 
constraints continue to dominate pricing dynamics.

   Until redundancy improves or regional fuel production stabilizes, the 
benefits of lower gasoline demand may remain elusive for U.S. West Coast 
drivers even as the EV era steadily advances.




(c) Copyright 2025 DTN, LLC. All rights reserved.