A new study from the University of Southern California suggests the state could see fuel prices rise as much as 75% by late 2026. That would push gas near (or even past) $8 a gallon. The key drivers are shrinking refinery capacity, stricter emissions regulations, and the state’s uniquely clean-burning fuel formula. At the same time, President Donald Trump just signed a resolution that blocks California’s rule banning the sale of new gas-powered cars by 2035.

Northern California already faces supply chain pressure

Refineries in Martinez and Benicia both suffered fires this year, tightening production and making it harder to keep pumps stocked affordably. Local business owners, like Stockton’s Ernie Giannecchini, say wholesale prices have jumped 50 cents in a week, WCSC shared. He usually offers some of the cheapest gas in town, but now says he’s just breaking even.

The squeeze isn’t just about fire damage or summer blends. Regulatory costs are climbing, and that burden lands squarely on the consumer. USC’s Michael Mische said California’s own clean-air rules are a major factor and could be adjusted. For now, they’re adding weight to an already heavy load.

Meanwhile, on the national stage, President Trump commits to what the oil industry probably dreams about

In a campaign-aligned move, Rep. Kevin Kiley had announced that Trump would sign a resolution to block California’s planned ban on new gas-powered car sales after 2035. The president did so this afternoon.

President Trump didn’t hold back during the signing

He called California’s regulations “crazy” and said they’ve been “a disaster for this country.” On EVs, he was “skeptical” but also gave Tesla some praise, saying, “I like Tesla.”

The president then launched onto an unusual track about windmills and electric-powered boats, saying, “I’ll take electrocution every single day,” after imagining the risk of being shocked if such a boat sank. He joked about the danger of shark attacks, too, ABC7 shared.

The ban, originally greenlit under the Biden administration’s revival of California’s emissions authority, had been challenged before. The GOP-led Senate recently overturned three key Biden-era emissions waivers, setting the stage for a larger rollback of California’s environmental autonomy.

The California Attorney General already announced that the state plans to challenge the resolution in court.