The State Legislature was called into a second special session by the governor before the gavel fell on the 2023-2024 Legislative Session.
Last week both houses of the Legislature met and discussed two bills designed to smooth out price spikes at the pump. Oddly, however, the reason for price volatility in the finished fuels market in California is due to the governor’s anti-local production policies, not price gouging by producers, refineries, or gas stations.
Since the governor took office, he has shut down over 100,000 barrels of oil production per day. This only diverted money from local jobs and independent producers to foreign cartels like OPEC+ countries.
The Los Angeles Times published an article discussing the 2nd Extraordinary Session. The governor continues to seek a solution for high gas prices without considering increasing in-state production. He has not reached out to CIPA to ask if we can responsibly increase production outside of “health protection zones.” No one from the Legislature is banging their shoe on the desk demanding more California oil production, which is cheaper and better for the environment and the climate crisis.
No, instead, the administration wants refiners to store up 15 days of finished supply so that when prices rise, the state can release the reserves and smooth out price increases—or such goes the governor’s logic.
While the state’s leaders are claiming they want more “transparency,” there is already plenty of transparency and much oversight of the entire oil industry from upstream to downstream. The governor argues, without any evidence at all, that oil companies are responsible for price manipulation, while critics point out that these new measures do little to address the core supply and demand issues.
While the governor’s actions may be well-intentioned, his focus on penalties and transparency feels like a short-term fix – a political gimmick that doesn’t solve the systemic issues behind rising gas prices.
CIPA’s oil producers stand ready to increase production and ensure that less expensive and more responsibly produced crude oil is plentiful. After all, there is enough oil in the San Joaquin Valley alone to keep California going for hundreds, if not thousands, of years into the future.