SAN DIEGO (KGTV) — For the first time in nearly a month, gas prices in San Diego did not increase on Monday, but they are expected to jump ahead of the summer travel season. The average price is still above the $5 mark and $0.44 higher than a month ago.
Team 10 senior investigative reporter Jim Avila digs into who is responsible for the recent spike.
The average price of gasoline in California was $5.45 as of Monday, April 15.
Drivers in every other state of the mainland United States are paying in the $3 range. What and who are to blame for this expensive discrepancy?
Oil companies, which are reporting record profits, claim in TV ads, billboards and even at the pump it's not their fault. They blame California's taxes attached to the price of gas and tariffs designed to reduce pollution and build new roads.
"This is not about greed. This is about markets, and if we look at the facts, if you look at the public policies, our state, it's the cost of doing business in California," says Kevin Slagle, a spokesperson for the Western State Petroleum Association.
Gov. Gavin Newsom vehemently disagrees, saying in a recent press release, "oil companies are making a killing" and accusing them of "greed" and "gouging."
Of the $5 per gallon Californians pay, consumer watchdogs say oil companies are making a $1 profit, a quarter more than they make in any other state.
"There's no question in 2022 and 2023, their profits were higher than they've been in the last 20 years," says Jamie Court of Consumer Watchdog. "So, for them to say they're making pennies is just malarkey."
The state's new watchdog division of the California Energy Commission says there is evidence of windfall profits. Under a new California law, the commission is now empowered to fine oil companies for excess profits.
"If the profits for the industry continue to be abnormally high or excessive, profits get even higher," says Tai Milder, who oversees petroleum markets for the California Energy Commission. "There is a pathway for the Energy Commission to enact a penalty on the industry and get some of that money back for consumers."
So, who is to blame for California's $2 gasoline surcharge over the rest of the country?
The state's taxes and environmentally friendly gas mixture amount to $0.70 a gallon. The oil companies' gross profits amounted to a dollar a gallon over the last two years, double their 20-year average of 0.50 cents a gallon in profit.
