Diesel Cost per Gallon in California (2026)

Why Diesel Costs $6.89/Gal in California

California diesel prices are consistently the highest in the contiguous US. Three factors combine: CARB diesel specifications require additional refining steps and a separate supply chain from the rest of the US; California's state diesel tax is the highest in the lower 48 at approximately 102 cents/gal including cap-and-trade compliance costs; and California's refinery capacity cannot meet in-state demand, requiring imports of finished product via tanker. The California-to-Texas spread is roughly $1.91/gal in mid-2026: the structural pieces are the $0.82 tax difference and a $0.15-0.25 CARB premium, with the wide remainder reflecting tight West Coast supply (California at $6.89 and Washington at $6.13 are running well above the PADD 5 norm). California is also the only state in the contiguous US that cannot receive fuel by pipeline from Gulf Coast refineries because no finished-product pipeline crosses the Sierra Nevada range.