Bold move by California to prevent gas price hikes

California Gov. Gavin Newsom has proposed a measure that would force refiners in the state to maintain a certain level of gasoline inventories to avoid shortages that lead to price increases at the pump.

“Pump Price Spikes Are Profit Boosts for Big Oil,” Newsom said in a press release. “Refiners should be required to plan ahead and replenish supplies to keep prices stable instead of gambling to make even more profits. By making refiners act responsibly and maintain a gas reserve, Californians would save money at the pump every year.”

The proposal follows findings by the California Energy Commission that for 63 days last year, refineries in the state maintained a gasoline inventory of just 15 days of consumption, which the governor’s office said led to higher prices.

“The data is clear: oil refiners have accumulated profits by scheduling maintenance that reduces supply during our busy driving seasons,” said the head of the CEC’s oil market surveillance division. “The governor’s proposal gives us new tools to require refiners to responsibly plan and prevent price spikes during maintenance,” Tai Milder added.

Big Oil has been a thorn in the side of California’s current governor for years. The industry has been blamed for Californians paying the highest gas prices in the country, for lying about climate change, and for literally existing.

Regulation and lawsuits are the two tools Newsom has at his disposal to fight Big Oil, and both are being used liberally. Last year, the state’s governor and attorney general filed a lawsuit against Big Oil for “hiding the fact that they have long known how dangerous the fossil fuels they produce are to our planet.”

Newsom also instituted a ban on internal combustion engine vehicles that would go into effect in 2035.

By Irina Slav for Oilprice.com

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