SACRAMENTO, Calif. (Sept. 26, 2024)—A bill proposed by Gov. Gavin Newsom that requires oil companies to store enough gasoline to protect consumers from price spikes during refinery shutdowns was approved today by the California Assembly Petroleum and Gasoline Supply Committee.
The bill, which would make California the first state in the nation to impose minimum inventory requirements on oil refiners when they go offline for maintenance, was the subject of public hearings held by lawmakers last week during a special session to address California’s high gasoline prices. The full Assembly is expected to vote on the bill on Oct. 1, and the Senate will take it up in the following weeks.
The following statement is by Daniel Barad, western states policy manager at the Union of Concerned Scientists: “This is a necessary measure because gas price spikes for Californians turn into profit spikes for oil companies when refiners don’t set aside adequate fuel in advance of shutdowns, a pattern revealed by the California Energy Commission that has been happening as recently as this past month.
“I commend Gov. Newsom for fighting back against the oil industry's efforts to manipulate the market and harm consumers with high gas prices. The governor is well aware that California’s gasoline refining sector is becoming highly concentrated, and he is leading the effort to ensure oil companies don’t abuse their market power by holding them accountable for better managing refinery shutdowns.
“Among the measures under legislative consideration to reduce gas prices during the special session, the governor’s proposal stands out because it addresses affordability without undermining health and clean air protections.
“Establishing requirements for minimum fuel storage is also a critical step in planning for a safe and equitable petroleum phaseout as gas consumption declines in California and the state moves toward zero-emission transportation.”
Additional Resources: Fact Sheet: A Petroleum Phaseout Plan for California Blog: California Needs a Petroleum Phaseout Plan