Gov. Gavin Newsom’s proposal to penalize excessive oil refinery profits is a relatively straightforward effort to prevent price gouging that reached new heights this year as gas prices in the state spiked to more than $6.40 a gallon. While Californians paid $2.60 a gallon more than the average American motorist to fill their tanks, companies such as Chevron, Valero and Phillips 66 raked in billions in record profits.
It’s bad enough that oil companies peddle a product that pollutes the air and heats the planet while using their money and influence to block climate action. They shouldn’t be allowed to fleece Californians while they do it.
The details of Newsom’s proposal are still being worked out, but it’s essentially a cap on excessive oil refinery profits. If a refiner’s profit margin per gallon of gasoline exceeds a yet-to-be-determined threshold, the state would issue a penalty, claw back a percentage of those profits and return it to California consumers.
