California Governor Demands Investigation Into High Gas Prices

Matt Posky
by Matt Posky
california governor demands investigation into high gas prices

On Tuesday, California Governor Gavin Newsom responded to a new report claiming oil companies have been overcharging customers over social media.

“[California] drivers have paid an average of 30 cents more per gallon. There’s no identifiable evidence to justify that,” Newsom said. “I’m demanding an investigation. If oil companies are engaging in false advertising or price fixing — legal action should be taken.”

With California leading the charge against the federal government’s proposed fuel economy rollback, Newsom’s words are a bit of a faux pas. While we agree that companies should not be engaging in price fixing, California’s high fuel prices are largely its own doing. Newsom’s claims completely ignore this rather obvious fact — calling his ability to effectively negotiate the national fueling fracas into question.

We weren’t the only ones to notice, either. Twitter users immediately responded to the governor, with many acknowledging that Californians actually pay the highest gas taxes in the whole country (the state surpassed Pennsylvania this summer). Equally bizarre is Newsom’s outspoken support of the state’s 2017 gas tax increase and condemnation of 2018 ballot measure aimed at repealing it. He has to know that’s why fuel prices are so much higher there… right?

The California Energy Commission (CEC) report Newsom referenced was something he commissioned earlier in the year. The goal was to determine why Golden State residents were paying so much more for gas than people in other parts of the country. However, the CEC report determined “the primary cause of the residual price increase is simply that California’s retail gasoline outlets are charging higher prices than those in other states.”

It also outlined how much more Californians are being charged via regulatory measures and fuel taxes. The report estimated that California’s gas prices were $0.75 higher than anywhere else in the country last year, and over half of that appears to be directly attributable to the state’s taxes, low-carbon fuel requirements, and greenhouse cap-and-trade program. The West Coast, which is also subject to higher crude prices than other parts of the country, ran into supply problems this year as local refineries swapped over to special blends not used in other states.

While that doesn’t automatically exonerate Big Oil from the suspected price fixing, it also doesn’t support any accusations against them. Ultimately, this forced Newsom to kick the can down the road to Attorney General Xavier Becerra. The California Energy Commission did the same:

The CEC does not have any evidence that gasoline retailers fixed prices or engaged in false advertising. Moreover, the CEC lacks the expertise to determine whether such behavior occurred. The California Department of Justice is well equipped to conduct an appropriate investigation.

The whole thing is a little confusing. Newsom appears concerned with the high prices Californians have to pay at the pump but completely overlooks the core reasons for the problem. This offers plenty of ammunition to his political opponents in the gas war, especially with the Environmental Protection Agency repeatedly accusing the state of being mismanaged — and creating new ecological issues while failing to effectively address existing ones. At least, that’s how EPA Administrator Andrew Wheeler tells it.

At this point, we don’t expect either side to play fair and take anything at face value. Still, this will be a black eye for California, and it could have been avoided entirely if state leadership bothered to address why we need fuel taxes, or if it promised to tamp them down in the future. Instead, the governor responded to public complaints of high fuel prices by pointing the finger at Big Oil with no proof.

[Image: Michael Vi/Shutterstock]

Comments
Join the conversation
2 of 82 comments
  • IBx1 IBx1 on Oct 25, 2019

    hahahahhahaha Oh wait, he's serious, let me laugh even harder HAHAHAHAHAHHAHAHAHAHHAHAHA

  • -Nate -Nate on Oct 26, 2019

    "asking why they charged so much more. All the owners had the same response, “Because we can”. " "Gas price collusion has been investigated on and off for 45 years, with no evidence of it." " Raising the price only drives customers away." .....Followed by the usual alt right whiners who envy California and so take any opportunity to lambast it and take childish dishonest pot shots instead of being grateful that Californians all pay more Federal taxes to prop up the bankrupt red states.... In reality, the gasoline prices are only excessive because the gop deregulated the pricing, that's it . True in the 1970's when they did it, claiming it would make all fuels cheaper, almost free ! (like electricity and insurance, remember ? of course you don't, the truth scares you witless) . If you're envious of the substantially better life we have in California, stop whining and LEAVE then S.T.F.U. and enjoy your miserable bankrupt red states poverty life . -Nate

  • Parkave231 Doghouse engines always make me (I'm sure unreasonably) uncomfortable. Obviously they work, and the covers are obviously designed to contain noise, heat, and belts that may fly off of a machine turning at 2,000 rpm. Still, it's *RIGHT THERE* next to your legs.
  • Michael Dalia My first car was a 1966 Pontiac Lemans. I also owned a 1972 Catalina and an 1988 6000LE. Currently I drive a 2007 G6 GT convertible which which I love and probably will have until I can no longer drive. Pontiacs are great!
  • Damage The mobile TV is a hoot. There wasn't a single thing on TV in the 70s that was good enough to justify the trouble and expense of putting a TV in your truck.
  • Theflyersfan As a kid, a neighbor had one of these full-sized conversion vans with the TV and wet bar in the back. And it was so cool to go in - as a kid it was, driving it had to be terror at times with blind spots, iffy power and brakes, and the feeling that you're hauling your living room with you! Kids of the 1970s and 1980s had this experience. Afterwards with minivans and then CUV everything, not so much.And I'm crushed that a 1977 van doesn't have some kind of mural on the sides. Coyote howling at the moon, American flag, Confederate flag, bright stripes, something! You can't have a 1970's era van with plain sides! At least a "Don't Laugh. Your daughter's in here" bumper sticker on the back. I always get a Gacy or Bundy vibe with these vans...
  • Jeff S In the EV market Tesla is not a niche player it is the major player. According to the latest data of the California-based vehicle valuation and automotive research company  Kelley Blue Book, Tesla has the lion’s share with 75 percent market share in  the electric vehicle market in the first three months of 2022.Tesla has dominated the electric vehicle market for years in the United States. The electric vehicles manufactured by Tesla accounted for 79 percent of the new electric vehicles registered in the United States in 2020 and 69,95 percent in 2021. The decrease in the market share in 2021 might be explained by backlogs and the global chip shortage, but the company is ramping up its sales and has already increased its market share to 75 percent in the first quarter of the year. According to Kelley Blue Book, the top 10 EVs sold in the US in the first quarter of 2022 are;[list=1][*]Tesla Model Y[/*][*]Tesla Model 3[/*][*]Ford Mustang Mach-E[/*][*]Tesla Model X[/*][*]Hyundai Ioniq 5[/*][*]Kia EV6[/*][*]Tesla Model S[/*][*]Nissan Leaf[/*][*]Kia Niro[/*][*]Audi e-Tron[/*][/list=1]Tesla has delivered 310,048 vehicles in the first quarter of 2022, another first-quarter record. The success of Tesla is proven once again as the company has three electric cars in the top 10 most selling electric vehicles in the United States, while no other manufacturer has even two different models on the list.Tesla leads all others, selling slightly over 936,000 units in 2021. This gave the company a market share of nearly 14%.Mar 30, 2022https://interestingengineering.com/transportation/tesla-ev-market-75-percent-market-share
Next