California Governor Gavin Newsom has signed into law a piece of legislation that will require the state’s oil refiners to report their profits-per-gallon.
The Oil Refiner Price Disclosure Act, SB 1322, also requires the state’s oil refineries to disclose once a month the price they pay for crude oil and profits generated on the gasoline they refine and sell.
State Senator Ben Allen sponsored the legislation after questions were raised concerning a purported “mystery surcharge,” what state residents feel is “an unexplained difference in price paid by California drivers when they fill up, even after all the federal and state taxes and fees are taken out of the equation,“ according to the LA Times.
“For far too long, refiners in our state have been able to keep their profit margins under wraps,” said Allen, who chairs the Senate Environmental Quality Committee and the Legislative Environmental Caucus. “I am very pleased by Governor Newsom’s signing of SB 1322, finally giving California drivers more information about why they are paying so much at the pump amidst record gains by oil companies.”
Consumer Watchdog says that Californians pay $1.26 more per gallon than the national average for gasoline, and that the state’s five big oil refiners generated between three and ten times the profits per gallon from West Coast operations during the second quarter of 2022 than they did the same quarter the previous year.
“Californians have been an ATM for oil refiners for too long and now it’s time for the legislature to push back on these outrageous profits,” said Jamie Court, president of Consumer Watchdog.
“These profit reports prove that the only reason Californians are paying so much more for their gasoline than drivers in every other state is because the big five refiners have the market power to charge them as much as they want,” he said. “It’s time for Californians to know exactly how much oil refiners have profited from their pain at the pump and for oil refiners to be forced to give back their excessive profits.”
However, Kevin Slagle, spokesman for the Western States Petroleum Association, calls the bill unnecessary and a “solution looking for a problem.”
Slagle also maintains the industry already submits an “excessive amount to data” to the government on a monthly basis, according to the LA Times.
“Yes, the last few quarters have been healthy quarters for the energy industry across the country and that’s due to demand,” Slagle said. “When you look during the COVID years when there was no demand, they lost $70 billion to $80 billion so there’s really a cause and effect with demand, as much as anything.”