The recent bill signing by California Governor Gavin Newsom to decrease gasoline prices has gotten a hostile reaction from the state’s oil and gas industry. Legislation signed into law on October 14, 2024, aims to curb surging fuel prices by forcing oil refineries to keep a minimum level of fuel in inventory. Newsom says that would help avert surprise price increases, especially when refineries are offline for maintenance. Yet, it has also received serious criticism by WSPA powerful trade organization that represents the oil industry.
Newsom had biting criticism for the petroleum sector, calling it deceitful and manipulative in his announcement at the bill-signing ceremony.”Particularly WSPA and their talking points and big oil that knowingly continues to lie to the people,” Newsom stated, accusing them of playing a central role in California’s climate crisis. “They are the polluted part of this climate crisis. They continue to lie and they continue to manipulate,” he added.
This aggressive rhetoric did not sit well with WSPA President and CEO Catherine Reheis-Boyd, who called Newsom’s comments a form of “political theater.” In an interview following the bill’s passage, she responded: “This is literally politics above policy. To have his attacks, which were filled with personal insults, only serves to divide, not address the real issues that we’re trying to deal with.”
Reheis-Boyd continued to express her concerns over the governor’s inflammatory language, particularly his reference to the industry’s workers. “To call the hard-working men and women of this industry… polluted hearts is just beneath the leadership that California deserves,” she said, calling the governor’s rhetoric divisive and unnecessary.
Concerns About the Impact of the Bill
The new law aims to reduce the financial burden on California drivers, who face some of the highest fuel prices in the nation. As of October 2024, the average cost of a gallon of unleaded gas in California was about $4.68, significantly higher than the national average of $3.20. The state government argues that regulating the fuel inventory of refineries will help ensure a more stable supply, thereby preventing sudden price hikes during maintenance periods.
However, the oil industry warns that the bill could have unintended negative consequences. Opponents, including WSPA, claim the law could increase costs rather than reduce them. They argue that the bill may disrupt refinery operations and lead to higher prices at the pump.
“It could unintentionally raise gas prices and threaten the safety of workers by giving the state more oversight over refinery maintenance schedules,” said Reheis-Boyd.
Industry leaders also believe that Newsom’s approach is too focused on punishing the sector instead of collaborating on realistic solutions. Reheis-Boyd suggested that the state could lower crude oil prices by supporting the reopening of pipelines and improving the business environment for refineries.
“We are sitting on one of the biggest reserves of oil in Kern County,” she said. “We can’t get the oil out of the ground because this governor won’t allow permits to be issued to producers to produce it.”
The Bigger Picture: California’s Environmental Push
The fight between Newsom’s administration and the oil industry is a part of the continuing fight over California’s ambitious environmental goals state has long been out in front in the drive for aggressive climate action to reduce carbon emissions and move toward renewable energy.
Rarely has Newsom cowed from driving a hard line against the fossil fuel industry, underscoring his belief the sector needs further regulation if it is to protect not only consumers but also the environment.
But Newsom isn’t deterred, with his spokesperson affirming that this bill is much-needed to safeguard Californians against what Newsom termed “Big Oil’s” long-standing manipulation of the market. The office of the governor has not commented further on more details on criticisms by the oil industry, except to say that Newsom’s remarks “speak for themselves.”
The introduction of this bill follows months of political debate and growing public frustration over gas prices in the state. Many see it as another step in California’s fight to curtail the power of the fossil fuel industry, while industry stakeholders argue that the approach is punitive and damaging to both the economy and the workers within the sector.
