San Francisco gas prices highest in nation

San Francisco had the highest average gas price in country last month at $3 per gallon, according to the latest report by the American Automobile Association.

While gas prices dropped in all but two California cities surveyed last month, increased demand on the West Coast over the July 4 holiday kept West Coast prices high.

But the good news is that prices may be stabilizing as regional production increases, AAA officials said.

Last month the average gas price in San Francisco dropped two cents, which is 11 cents higher than the Bay Area average and 77 cents higher than the national average, according to AAA officials.

The average price in Oakland was $2.87 and the average price in San Jose was $2.89.

The outlook for the summer is mixed as crude oil and wholesale gas prices are expected to fall this week, while disruptions in supply could occur because of weather and/or global political tensions, AAA officials said.