The group Consumer Watchdog is barking again about higher gas prices in California. The activist group announced July 9, “California drivers, who have paid an average of 74 cents more per gallon at the pump than drivers nationwide, have shelled out $4.5 billion more for their gasoline than U.S. drivers from February to June.”
It pegged the extra cost per driver at $180. The group called this the “Gouging Gap,” charging the major oil companies with “artificially manipulating gasoline prices by leveraging their branded gasoline station contracts.”
CW President Jamie Court blasted the oil companies for overcharging “drivers billions using every trick in the book to keep gasoline prices high from unusually low inventories, historically high exports, suspicious refinery maintenance and unprecedented pricing strategies at their branded stations.”
Actually, the reasons California’s gas prices are higher than those in other states, except Hawaii, are straight out of Economics 101: Lower supply means higher prices. The state uses special gas blends used nowhere else, and California last saw a refinery built in 1979. So, when a refinery goes down, we can’t import gas from other states.
As to exporting gas, why shouldn’t California refineries do that if they can make a higher profit? This isn’t North Korea, where the government owns industries.
Then there’s Assembly Bill 32, the Global Warming Solutions Act of 2006. On January, it put energy companies into the state’s anti-global warming cap-and-trade program, raising gas prices about 15 cents a gallon.
Billionaire hedge-fund infestor Thomas Steyer is thinking about putting an initiative on the November 2016 ballot to force refiners to reveal more information on pricing. According to the Los Angeles Times, he’s insisting about the oil companies, “They have to open their books – there are a lot more questions here than there are answers, and we need a full accounting.”
Full accounting? How about Hollywood and its notoriously opaque bookkeeping? Or what about prices for Silicon Valley’s computers, software and services? When does the market interference stop?