In case you ever wondered. It's surprising how many people aren't aware that Washington State has several refineries. With that thought comes the question.. Why are the gas prices so high for us? Here's an interesting read... 

Why Gas Prices Are Still So High in Washington (Even as Oil Hits 5-Year Lows)

By Leon Harper | PremierHouses.com

If you live in Washington State, you’ve probably noticed something that doesn’t make sense:
oil prices are at their lowest levels in five years — yet gas prices are still among the highest in the country.

So what’s really happening? And why does it matter for homeowners and buyers in Western Washington?

Here’s the short, clear breakdown.

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Global Oil Prices Are Falling — Fast

As of January 2026, global oil prices have dropped to near $56–$60 per barrel, driven by:

• A global oil surplus forecasted for early 2026

• A new U.S. agreement bringing millions of barrels of oil from Venezuela

• Saudi Arabia cutting prices to stimulate demand

• Slower global economic growth

Normally, this would mean cheaper gas everywhere. But Washington plays by different rules.

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Why Gas Prices in Washington Stay High

Even with cheap oil, the average gas price in Washington remains $3.70–$4.80 per gallon — nearly $1 more than the national average.

1. Carbon Costs (The Biggest Driver)

Washington’s Climate Commitment Act (CCA) adds roughly 45–50 cents per gallon in carbon compliance costs that fuel suppliers pass directly to consumers.

2. High Gas Taxes

Washington has the 3rd highest gas taxes in the U.S., at over 64 cents per gallon when carbon costs are included.

3. West Coast “Fuel Island” Problem

The West Coast isn’t connected to national fuel pipelines. When refineries go down or close, prices spike — and stay high.

4. Local Supply Disruptions

Recent pipeline issues near Everett and refinery maintenance across the region have kept supplies tight, slowing price drops.

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But Don’t We Have Refineries?

Yes — Washington has five major oil refineries, mainly near Anacortes, Ferndale, and Tacoma.
But carbon rules and taxes apply to them too, so local production doesn’t mean cheaper fuel.

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Where Our Oil Comes From

Washington refineries rely on:

• Canada (45–50%)

• Alaska (30%)

• North Dakota (20%)

Oil arrives by pipeline, tanker, rail, and barge, but shipping costs and regulations keep prices elevated.

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What a Gallon of Gas Really Costs in Washington

• Crude oil: ~$1.45

• Taxes: ~$0.74

• Carbon costs: ~$0.50

• Refining & distribution: ~$1.10

Total: about $3.80 per gallon

That’s why Washington remains one of the most expensive states to drive in — even when oil is cheap.

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What’s Coming Next (Important)

• Gas taxes will increase automatically starting July 2026

• Carbon allowance prices remain volatile

• West Coast refinery capacity continues to shrink

• Any relief from new oil supply (like Venezuela) will be slow

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Why This Matters for Homeowners

Higher energy costs affect:

• Monthly budgets

• Commute decisions

• Remodeling costs

• Home affordability

• Where people choose to live

That’s why we track this — because cost of living is part of real estate, not separate from it.

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👉 Want more local market insights like this?
I share weekly breakdowns on housing, costs, and trends affecting Western Washington homeowners.

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—
Leon Harper
The Original OG Broker – 1992
PremierHouses.com