CEC holding hearing November 29 with oil executives and experts
Oil industry made $63 billion in profits in 90 days as Californians paid record gas prices
Governor Newsom has proposed a price gouging penalty that will put windfall oil company profits back in the pockets of Californians
SACRAMENTO – Oil companies charged Californians record high prices for gasoline, even as the cost of crude oil went down, leading to record profits for the oil industry in the past three months. Today, the California Energy Commission (CEC) announced a public hearing on November 29 to bring in oil executives and experts to provide answers about gasoline price hikes amidst record profits, refinery maintenance, and how to prevent such price increases in the future.
“We’re taking action to get answers for Californians who paid for these record profits through gas price hikes. They had the opportunity to provide written responses, but big oil dodged and outright refused to answer basic questions. This hearing will help get answers for gas price hikes and help us make sure this doesn’t keep happening,” said Governor Gavin Newsom.
Governor Newsom spoke to these record profits as Californians paid price hikes at the pump.
This upcoming hearing follows the CEC having requested written responses to questions about price spikes despite the cost of crude oil going down – questions that the companies largely failed to answer in writing.
In the third quarter of 2022, from July to September, oil companies reported record high profits:
- Phillips 66 profits jumped to $5.4 billion, a 1243% increase over last year’s $402 million;
- BP posted $8.2 billion in profits, its second-highest on record, with $2.5 billion going towards share buybacks that benefit Wall Street investors;
- Marathon Petroleum profits rose to $4.48 billion, a 545% increase over last year’s $694 million;
- Valero’s $2.82 billion in profits that were 500% higher than the year before;
- PBF Energy’s $1.06 billion that was 1700% higher than the year before;
- Shell reported a $9.45 billion haul that sent $4 billion to shareholders for stock buybacks;
- Exxon reported their highest-ever $19.7 billion in profits;
- Chevron reported $11.2 billion in profits, their second-highest quarterly profit ever.
This comes on the heels of a report showing that refiners like PBF Energy are making more profits off of Californians than in any other state – $0.78 per gallon compared to the national average of $0.50, a 56% differential. According to Consumer Watchdog, “PBF reported making 78 cents per gallon refining crude oil into gasoline in California in the third quarter – the greatest raw profits anywhere in the nation or world. By contrast, PBF’s profits per gallon were 48 cents on the Gulf Coast, 49 cents per gallon on the East Coast, 55 cents per gallon in the Midwest – an average of 50 cents across the rest of America.”
Big oil was making these record profits at a time when Californians were seeing gas price hikes at the pump, despite the fact that the cost of crude oil was down:
Governor Newsom has taken action to lower prices at the pump, ordering the switch to winter-blend gasoline and demanding accountability from oil companies and refiners that do business in California, leading to record relief at the pump for consumers. Since California’s record-high gas prices of $6.42, the Governor’s actions have reduced those prices to $5.47 most recently – a decrease of 95 cents.