We, the undersigned elected officials representing communities across California, are outraged by oil company price gouging practices on our constituents and communities. We urge the Legislature to enact strong oversight measures and a price gouging penalty to prevent Big Oil companies from earning excessive profits at the expense of hard working Californians.

The evidence is clear that oil company greed led to the historic gas price spikes that hurt California families. Oil companies made record profits as Californians paid gas prices as much as $2.60 greater than US gas prices at the pump.  

While the price to make a gallon of crude oil did not change, the cost of gasoline skyrocketed as refineries put more money in their own pockets to the detriment of hard-working Californians. In the first nine months of 2022 alone, California’s Big 5 oil refiners posted profits of $67.6 billion — nearly quadruple the $17.6 billion posted for the same period in 2021.Shell’s profits more than doubled, their second-highest quarterly profits ever. PBF Energy profits increased by 1,700%. And Valero increased profits more than 500%. Oil companies made 30% more profits from Californians than any other region in the country or world.

Oil companies were profiting up to $1 billion per day for months, while Californians were struggling to fill up their tanks to get to work. When gas prices spike, low-income people and workers in our communities are hit hardest. At $4 per gallon, 9% of an annual minimum wage salary is spent on gas.  At $6 per gallon, 13% of an annual minimum wage salary is spent on gas.

That’s why we need an independent watchdog agency to ensure transparency and impose a price gouging penalty to hold oil companies accountable and put these excessive profits back into Californian’s wallets.

If a price gouging penalty had been in place at 50 cents per gallon in 2022, California’s five oil refiners would have had to pay a penalty of $3.1 billion back to the public.  In the past twenty years, the 50 cent per gallon profit line was only crossed three times (by Chevron each time). In 2022 all major refiners exceeded it.With this policy, penalties imposed on these oil refiners would have been $1.4 billion for Chevron, $764 million for Marathon, $555 million for PBF, $247 million for Phillips, and $212 million for Valero.

As the Governor and Legislature of California, you have a historic opportunity to lead our state in protecting Californians from Big Oil company greed by providing independent oversight and putting a cap on windfall oil and gas price gouging, to ensure our communities and climate are no longer victimized by industry profiteering.

Establishing a watchdog agency, ensuring market transparency, and enacting a price gouging penalty are critical steps in protecting Californians from the toxic oil industry and holding polluters accountable. EOPA California, representing over 462 elected officials from 49 counties, who are calling for a comprehensive plan to transition our state to 100 percent clean energy production. Together we can protect Californians, our community, and climate.  

We look to you to provide the leadership we need for a safe, healthy, just, and prosperous California.

Sincerely,

Elected Officials to Protect America members