California Gov. Gavin Newsom has proposed a measure that would force the state’s refineries to maintain a certain level of gasoline inventory in order to avoid shortages that lead to price spikes at the pump.
Newsom: “Higher pump prices are higher profits for Big Oil.” He said “Refiners should be required to plan ahead and replenish supplies to keep prices stable, rather than playing games to make more profits,” he said in a press release. “By having refiners act responsibly and conserve gas reserves, Californians will save money at the pump every year.”
The proposal comes on the heels of California Energy Commission findings that for 63 days last year, the state’s refineries held only 15 days of gasoline on hand, which, according to the governor’s office, led to higher prices.
“The data is clear: Oil refiners make money by planning maintenance that reduces supply during busy driving seasons,” said Ty Milder, head of the CEC’s oil market monitoring division. “The governor’s proposal gives us new tools to require refiners to plan responsibly and prevent price gouging during maintenance,” added Milder.
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 actually being there.
Regulation and lawsuits are the two tools Newsom has at his disposal to fight Big Oil, and they are being used extensively. Last year, the governor and state attorney general sued Big Oil for “covering up the fact that they have long known how dangerous the fossil fuels they produce are to our planet.”
Newsom also imposed a ban on internal combustion engine vehicles, set to take effect in 2035.
By Irina Slav for Oilprice.com
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