Gov. Gavin Newsom and state Sen. Nancy Skinner announced a proposal Monday to penalize oil companies in an effort to deter gas price gouging.
The proposal would make it illegal for oil companies to charge excessive refining margins– the price difference between the cost of crude oil pre-refinement and the cost of the product once it leaves the refinery– and would expand the ability of the California Energy Commission and the California Department of Tax and Fee Administration to investigate gas costs, profits and pricing.
The legislature is expected to negotiate in January about the refining margin that would trigger penalties under the proposal.
Any penalties collected from oil companies that are found to be artificially inflating gasoline prices would be placed in a state-managed fund and then reimbursed to state residents.
“Big Oil has been lying and gouging Californians to line their own pockets long enough,” Newsom said in a statement. “I look forward to the work ahead with our partners in the Legislature to get this done.”
Major oil companies like British Petroleum, Valero, Shell and Chevron reported record-high profits or near-record-highs during the third quarter of 2022, between July and September.
During that time, the state’s average price of a gallon of regular unleaded gas reached as high as $6.42. State officials have argued gas prices were excessively high, even with the price of a barrel of oil spiking during much of the spring and summer.
“No one can deny that California’s gas prices were outrageously high compared to other states,” said Skinner, D-Berkeley.
“And those high prices hurt California consumers and businesses.”
The California Business Roundtable, a group of senior executives of companies based in the state, argued the proposal is just a tax on oil companies and would lead to higher gas prices rather than deter them.
The group also blamed the state’s gas taxes for high prices over the summer, rather than corporate gouging.
“The governor is sending a message to investors and companies across the country that California now intends to start micromanaging business decisions, in addition to the myriad and growing regulations, high taxes and policies that continue to make California the worst place in the nation to do business,” CBR President Rob Lapsley said in a statement.
As of Monday, the average price of a gallon of gas in California is $4.77, according to AAA. The national average is $3.40 per gallon.
35 comments
Way to drive out the oil companies from the state completely.
Newsom=brainless.
And push us into electric vehicles. Newsome has his agenda.
Switzerland is banning electric vehicles. California will ban ALL vehicles. This is the desired outcome. Gavin is not stupid, the plan is straight evil. I wish it was simple stupidly.
Janes we don’t want to hear any complaints from you about high gas prices here. You’re ok with mega oil company profits and price gouging? Do tell what would you do to remedy the situation…
It’s an interesting group here who complain about high gas prices as they have in the past few months and then complain about the state government trying to do something about it. Certainly there are many dumb things the “democrats” do and the DNC just like the GOP are now owned by big business “elite” but this may not be that bad an idea though maybe a little late.
Everyone is hurting now with the economy like it is and yet Biden spends billions we don’t have on Ukraine. The only solution I see is an entire global economic collapse so we can erase the board and start over (if there is anyone left to do so).
Drill more, refine more.
Liberals scream the loudest about things they don’t understand. Truly 🤡 status post.
Buy some stock in oil and gas companies and profit from the dividends and price appreciation, duh. I’ve been doing this for decades. It’s not rocket science!
What are you talking about,words in others mouth liberal?I said nothing about high prices,where did i mention it?The companies wont want to pay these fines and lose all that money and they will leave.They wont stay and raise prices,you’re the one compaining about that and saying I am,Your brain is as complete a empty head Gavin.You hope they stay and the price goes up.They will leave,there wont be any prices.Get a clue yet?Stop saying people are saying the things YOU are saying.
I have 3 cars,all of them require Super unleaded.Do I sound worried about prices.?There wont be any gas Einstien,
It’s odd that the same people upset about high gas prices are also opposed to holding oil companies accountable for gouging us. They aren’t looking out for your needs.
We’re upset about gas prices because we understand economics and know the government is hurting us intentionally.
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You on the other hand beg to be governed harder.
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We are not the same.
Other states don’t have the high taxes on gas like California. And yes, Newsom is promoting his agenda. It will only hurt Californians
The cost of gas wouldn’t be so high if people in government, like Newsom, hadn’t voted to increase taxes on it … which get diverted to uses other than intended … and impose expensive “Callifornia-style” regulations which drive up the cost. Government created the problem, now in a back-handed fashion, they’re going to fix it. Maybe. Or, they will just add another layer of government morass over it — further complicating the issue.
Yet the government is responsible for it.
Stupid politicians.
Can we sue for tax gouging?
Wait. I thought it was Putin’s fault. So hard to keep up sometimes.
As of Monday, the average price of a gallon of gas in California is $4.77, according to AAA. The national average is $3.40 per gallon. Stop it! You need to also say, the average tax on a gallon is X nationally and Y in California.
The last couple of days I’ve seen numerous stations from Martinez, Concord to Danville and beyond at $3.99.
So now explain why it’s more than doubled sense Trump left office genius. Happy about 4 dollar gas is another 🤡status post from you. That’s 2 so far today. Keep going
That’s fine but what guards will be in place to prevent big oil from raising prices again? and what will Newsom do with the penalty $$ ? My bet he puts it to his pet projects that are totally politically motivated to his benefit.
Great! one more way they can pass that savings along to us. I don’t think people get it… corporations do not and have never paid taxes or fines, they simply broker the money by transferring it from the customer to the government.
Taxing Crack Spreads is detrimental to incremental efficiency improvements,
Fuhrer Newsom strikes again. So his argument is the Oil Companies have singled out one state, California, for profiteering and he, our savior, will by golly hold them to account.
And he expects us to believe that? That’s the best story his minions could come up with?
More shortsightedness from Newsom. Thwarting energy commerce will only make things worse in California as energy companies will simply reduce supply. Remember odd and even license plate days?
Hmmm. Nationalize the oil industry? What could go wrong with that?!
So instead of looking internally at the astronomical price gouging done by himself and his cronies, he is going to go after the oil companies. Way to attempt a deflection. Unfortunately there are fools who will believe his stupidity, in fact apparently a small majority of those who voted in the last election do actually believe him. Mind boggling!
The average price of gasoline across the nation is X, but in California it is X plus whatever additional taxes Newscum and cronies want to add. Why does California need that much more in taxes when compared to other states? Are our roads better, no. Do we have better resources, no. Do we have more public transportation, no. We have more people paying the exorbitant taxes, so you would think we could charge less and still get the same total amount of money as other states – but apparently not in California.
I work in a bay area refinery. The amount of regulatory compliance that is required to operate a refinery in California would astonish you. That drives up the cost of refining all product leaving the facility. It produces a lot more than just gasoline for cars. Jet fuel for the airport, natural gas for your homes, the plastic your Starbucks cups are made from is based on Hydrocarbons. Plus we have over one dollar of tax on every gallon of gas that the voters approved.
Be careful of what you ask for. The oil companies my leave this state one day. Then the cost of gas will skyrocket.
Does every state that has lower gas prices have refineries?
No. They have less taxes on the fuel, less regulations that drive the cost of refining up and the union workforce in the refinery makes insane money. Why do you think gas in Texas is around $3.20 a gallon in Houston?
Grandstanding publicity stunt to gain higher office.
This should have been done decades ago and will ever happen. Big oil will see to that.
Biden also promised the same thing, yet ‘that commission’ was never formed.
Skinner from Berkeley and Newsom form a comedic pair! The dangerous aspect is what the vacuous-mind individuals voted to return these two to office, along with Pelosi, Eshoo, Swalwell, Weenie-Weiner, and so on…..!!
“Age of Aquarius…..!”.
That’s really gotta be awful to be Gavin Newsom because for the rest of hids life he can’t go anywhere without armed guards,becuase he knows if certain people(Joe Public) see him in public he will get beaten down.
What about PG&E Gavin? Now they want to come after solar because their losing to much money. What is their profits
California gasoline must be made with foreign oil (volatile whenever there is a war) per the California government/CARB requirements to make our friendly winter/summer blends. Different formulas must be produced for winter and summer, hence low supply in May and October (starts a couple weeks earlier when the supply of the current required gasoline must be reduced), and translates to higher prices during these months. Large fines for oil companies if wrong formula sold after date of summer/winter blend requirements. Taxes another issue.
California will always have higher prices than the rest of the country. Gasoline CANNOT be brought in from other states as no other states meet California formula requirements. Refineries must shutdown for maintenance yearly, and no additional supply available, again higher prices when low supply. More micromanaging will lead to higher prices.
More pretending that they’ll do something. I thought that was a campaign promise (ie, lie) that they came out with months ago.
They’re not gonna accomplish one damn thing. Just watch.
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