Watchdog Makes Case For Windfall Profits Cap
Sacramento, CA -- California’s four big oil refiners more than doubled their average profit of the last 20 years from California during the recent gasoline price spikes, according to testimony delivered by Consumer Watchdog to the California Energy Commission today.
Consumer Watchdog also testified that the four oil refiners that report quarterly profits to their investors reported 30% greater profits from California during 2022 than from anywhere else in the nation or world.
“Californians are being punished with gasoline prices that were as much as $2.60 more than US gas prices and the proof of the price gouging is in the profits reports,” said Jamie Court, president of Consumer Watchdog. “California oil refiners reported truly windfall profits in 2022, profits levels they have never reached in the last 20 years. It’s time for the state to set a windfall profits cap on oil refiners so that the Golden State gouge comes to an end.”
Reports to investors show over the last 20 years oil refiners in California made an average of 32 cents per gallon refining gasoline, this year they more than doubled the margin to make 69 cents per gallon in profit, according to the testimony.
The four refiners that report quarterly profits – Valero, PBF, Phillips 66, and Marathon – made an average of 86 cents per gallon in profit during the second quarter and 73 cents per gallon during the third quarter. Until this year, none of the four oil refiners have made profits that have exceeded 50 cents per gallon.
Chevron only reports its profits on an annual basis. During the last 20 years, Chevron has made profits per gallon in California that have exceeded 50 cents per gallon only 3 times.
Counting any profit above 50 cents per gallon as a windfall profit, the four refiners that report their quarterly profit would owe Californians back $1.8 billion for their windfall profits in the first three quarters of 2022, Court testified.
Court noted that California’s big five oil refiners posted overall profits of $67.6 billion in the first nine months of 2022 – nearly quadruple the $17.6 billion recorded for the same period in 2021. The five refiners -- Chevron, Marathon, PBF, Phillips 66 and Valero -- make 97% of the gasoline in California.
“Californians have paid billions too much at the pump due to oil refiners’ price gouging,” said Court. “Now it’s time for the California legislature to take up Governor Newsom’s call for a windfall profits cap during the special session and give them much needed relief.”
Watch Court's testimony below.