Groups lobby California legislature to pass bill on fuel ‘price gouging’

More than 100 activist groups are calling on California’s state legislature to adopt Gov. Gavin Newsom’s (D) proposal to penalize oil companies for “price gouging.”

The groups maintained in a letter Tuesday that expediting the proposal — introduced by state Sen. Nancy Skinner (D) — is necessary “to hold the oil industry accountable and protect Californians from the industry’s greed and profiteering.”

“While Californians paid as much as $2.60 more for their gasoline than average US gasoline prices, California oil refiners continued to post record-breaking windfall profits — literally profiting off Californians’ pain at the pump,” the letter continued.

Greenpeace USA, the Center for Biological Diversity and the Sierra Club’s California chapter were among the dozens of groups that signed the letter.

Newsom unveiled the proposal in early December with the aim of penalizing oil companies for generating “excessive profits.” Together with Skinner, he said the move could “deter excessive price increases and keep money in Californians’ pockets.”

Skinner’s bill, introduced alongside the governor’s proposal, would require operators of California refineries to submit an activity report to the State Energy Resources Conservation and Development Commission within 30 days of the end of each calendar month.

To curb profits, the legislation would also establish a maximum gross gasoline refining margin at a yet unspecified amount per gallon while authorizing the commission to adjust the margin each year.

In addition, the bill would allow the commission to issue an administrative civil penalty if a refiner exceeds the maximum margin.

Penalizing the state’s biggest oil refiners “is needed when they tripled corporate profits in 2022 amid record prices at the pump for working class Californians,” Raquel Mason, policy manager of the California Environmental Justice Alliance, one of the groups that signed the letter, said in a statement.

Mehran Khodabandeh, senior political strategist of the California Working Families Party, likewise pushed for the passage of Skinner’s bill and called for the legislature to redistribute profits earned by oil companies to state residents.

“As hard-working Californians rationed their expenses to afford record high prices at the pump, Big Oil’s price gouging pumped up profits,” Khodabandeh said.

The first state Senate hearing on the subject is slated to take place on Wednesday.