In a letter to Gov. Gavin Newsom, Legislative Republicans are calling on the governor to explain the projected impact of his fuel storage mandate proposal on gas prices, how he plans to mitigate shortages, and how these new policies will align with existing measures that could increase costs.
The governor’s plan, introduced as SB 950 just days before the end of the legislative session, would require refiners to withhold fuel inventory from the market to serve as a cushion against price spikes. However, the California Energy Commission warned “it may artificially create shortages in downstream markets” and “increase average prices for refiners to maintain additional storage.”
“If Newsom wants to jam this reckless plan through the Legislature at the last minute, he should level with Californians about just how much this will increase costs for drivers,” said Assembly Republican Leader James Gallagher (Yuba City). “Democrats have already given Californians some of the most expensive gas in the country. Newsom is insane if he thinks we’ll stand by as he tries to make things even worse.”
“Despite promising Californians that his 'price gouging' political play would lower gas prices, Gavin Newsom is finally realizing that he’s done nothing but increase costs for Californians at the pump,” said Senate Minority Leader Brian W. Jones (R-San Diego). “Just like his last failed plan, SB 950 will only increase gas prices and further burden financially strapped Californians. Newsom is driven around by taxpayer-funded chauffeurs, in taxpayer-funded SUVs, filled with taxpayer-funded gas. The man hasn’t touched a gas pump in years. Should we be following his lead on this, or the economists and business owners who actually know what’s going on and are screaming from the rooftops that this bill will hurt consumers at the pump?”
In their letter, Republican lawmakers asked for answers to the following questions:
- What is the expected impact (per gallon) on retail fuel prices of requiring refiners to withhold inventory from the market, and how was that projection calculated?
- How do you plan to mitigate or prevent the fuel shortages the California Energy Commission is warning of if SB 950 becomes law?
- How do you reconcile the policies being advanced by CARB that will intentionally increase fuel costs with the Energy Commission’s goal of stabilizing the price of fuel?
In addition to the harm that could come to California drivers because of California’s misguided energy policies, leaders from Nevada and Arizona have warned that Newsom also risks destabilizing the fuels market and increasing costs in our neighboring states.