California's gas prices are rising again, but this time it's not part of a nationwide trend. Gov. Gavin Newsom's rebate and a sooner-than-expected switch to our cheaper winter blend could help, but they aren’t long-term solutions.
"It just doesn't add up," said Gov. Newsom in a video posted online on Friday. "The degree of divergence from national gas prices has just never happened before ... the fact is, they're ripping you off."
But the Western States Petroleum Association said that's not what's happening.
"If there's less supply, there's more demand, and the cost goes up," said Kara Greene with the WSPA.
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Supply is down. Several of California's 17 refineries are offline for maintenance that happens every few years. In the last month, California's average gas price jumped $1.13, all while the national average stayed largely the same.
"California has a special blend of gasoline," said Greene. "It's better for the environment. We do pay more for that, but it takes a lot more work to make it."
For the most part, only California refineries make our special blend of gas and several of them are out of service. Greene said California is a fuel island, because there are no interstate pipelines that could help out-of-state refineries to step in and help meet our demand.
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"I think that is the most I've ever payed for gasoline," said State Sen. Brian Jones, who represents California's 38th District.
He said with prices going up, Sacramento should at least look to the state's regulations on gas quality and the oil industry.
"If the governor has the authority to speed up getting to the cheaper blend, he ought to have the authority to redo a lot of these regulations," said Jones. "Let's look at the entire regulatory scheme to find what's causing these prices to go up."
California's refineries can process around 2 million barrels a day. Sen. Jones said he doesn't think building new refineries to increase gas production is possible.
"We've been shutting down refineries," said Jones. "Building new ones that are efficient and clean would be a great idea. I just don't know if we could ever get that done in California."
However, some democrats like Gov. Newsom say the real reason for high gas prices in California is a mystery surcharge added by the oil industry.
A new law takes effect in January would require all 17 refineries in California to disclose their profits every month. In a statement to NBC 7, the law's author State Sen. Ben Allen said:
"Open your books and show your true costs of doing business. We know exactly how many pennies the state’s environmental fees and gas taxes are, and that is not the whole story. The fact is, since 2015, consumers have been paying a mystery gas surcharge that can’t be explained by market or regulatory forces. I wrote SB 1322 to shine a light on the mystery of oil refinery math.”
NBC 7 also reached out to several members of the State Senate's Energy, Utilities, and Communications committee, including the Chair, State Sen. Ben Hueso and Vice Chair State Sen. Brian Dahle. Neither of them provided us with an interview or statement.
