A New Bill to Combat Oil Prices
Why Californians pay so much more to power their cars.
“Many of the businessmen in the oil industry believe that the government is trying too hard to insert itself in complicated business they shouldn’t be in.”
Driving home from work every day, you pass the gas station. Brightly-lit LED letters spell out a number: 4.957. Yesterday it was 4.856. The week before? 4.582. You don’t feel it immediately, but slowly, ever so slowly, even these small increases in price will start showing in your bank account. California gas prices have been skyrocketing for a while now, with little to do as gas simply becomes more expensive. However, on October 14th, California governor Gavin Newsom passed a bill to combat the rising California oil prices.
It is calculated that average Californians have to pay $4.68 a gallon, compared to the national average, $3.20, of the rest of the country. This is a problem, it has been. While much of the expense is due to taxes and environmental regulations and procedures, that doesn’t cushion the toll it has been taking on the credit cards of Californians across the whole state.
All residents in California pay the highest price for gasoline.
According to the Division of Petroleum Market Oversight, much of the gasoline pricing has to do with the spiking of global gas prices. This inspired the new legislation to pass the law that is aimed to stop all sudden increases of gas prices.
This law alone might save Californian citizens millions of dollars spent on powering their gasoline cars.
However, an argument raised is that with the decrease or stability of oil prices, environmental effects might follow. Newsom argues that the small decrease in pricing will not affect the environment as much as it will affect the businessmen in the gas industry.
“They continue to lie, and they continue to manipulate,” he says. “They have been raking in unprecedented profits because they can.”
But, taking a look at the real causes for sudden price spiking, it is seen that all of California’s gasoline is processed in-state. Because of the strict environmental rules that apply to gasoline in California, all of it is refined in-house. This means that across the entire state, up to 90% of the gas refining is controlled by just four companies.
Just four.
And, because of this, these four companies are increasingly vulnerable and prone to disruptions, causing the gas prices to skyrocket.
However, California’s severe regulations for gasoline refining is not without its purpose. In fact, it is estimated that by 2024, the greenhouse gasses produced through gasoline will have dropped by 85% since 1990.
So, despite the great protest of the Californians and the effort of Newsom, many believe that these gas prices will never go down. In fact, they believe the problem will only worsen.
“I don’t think you can,” Tom Robinson, a chairman of the gasoline company Rotten Robbie, mentioned in response to the government’s effort to fix the situation.
Many of the businessmen in the oil industry believe that the government is trying too hard to insert itself in complicated business they shouldn’t be in.
“We fundamentally believe that we are being set up for failure,” said Eloy Garcia, one of the people who accused the government of holding too tight to the markets and of “micromanaging.”
Whether or not these businessmen are right, they got one thing spot-on: this is a complicated, twisted situation that doesn’t seem to have a definite answer.
Will the government truly plant themselves in the oil market? Will they finally find a way to drop the prices without increasing the greenhouse gasses created? Will Californians finally drive by the gas station and begin to see prices that make them breathe a sigh of relief?
Stay tuned to find out more.
Works Cited
https://apnews.com/article/california-gas-prices-newsom-e2e3e79cc374ca09afd6867351fe6d35
https://www.cbsnews.com/sacramento/news/gov-newsom-signs-law-aimed-at-preventing-california-gas-prices-from-spiking/
