There’s good news: Gas prices are dropping nationally. In California, on average they’re down about 18 cents from last week. A main reason was the state’s cheaper winter blend was allowed in late September, a month early. But prices at the pump still are higher here than in the rest of the country.
“All this is, is price gouging,” Gov. Gavin Newsom charged Sept. 28. “They’re gonna spin you and it’s the taxes and the environmental rules – and it’s B.S. You’re smart enough to know what those taxes are compared to the national average and it doesn’t add up.”
Yes it does. Consider this comparison. On Oct. 17 the lowest price for regular gasoline in Ehrenberg, Arizona was $3.79, according to GasBuddy.com. Drive west across the Colorado River seven miles, and in Blythe, Calif. it was $5.39, or $1.60 more. There’s no reason why oil companies would “gouge” in Blythe but not Ehrenberg.
Statewide, according to the Gasprices.AAA.com, on average it was $4.31 in Arizona and $5.59 in California, or $1.28 more. Nationally, it was $3.59; meaning California was $2 more.
The real reason, GasBuddy.com analyst Patrick De Haan explained, is the state suffers “the lack of refining capacity, a special blend that’s only required in California, high taxes [and] a cap-and-trade program.”
California’s market, although large, is but a fraction of the entire global oil market. Economist and Chapman University President Emeritus Jim Doti wrote in the Register earlier this year oil high company profits now are a mirror of the massive losses they suffered three years ago when Newsom and others panicked during COVID-19 and shut down the economy.
This year Newsom pushed through SBX1-2, which established fines for supposed “price gouging” and set up a new Division of Petroleum Market Oversight bureaucracy to monitor industry pricing. Also, last month he and Atty. Gen. Rob Bonta announced a lawsuit against the big oil companies for supposedly “misleading” the public about climate change.
Both actions will raise oil-company costs, which will be passed on to consumers. There’s no price gouging. Just the usual California over-taxation and overregulation.
