Santa Monica Consumer Group Says California Drivers Paid $10 Billion More Than Other States

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December 17, 2015 — Just how much more did Californian drivers allegedly overpay for their gas in 2015?

Try $10 billion, according to Santa Monica-based Consumer Watchdog.

Speaking at a meeting Wednesday of a special state advisory panel on the oil industry in Sacramento on Wednesday, Consumer Watchdog President Jamie Court said evidence shows oil refiners used “back-door trades and inside information about competitor pricing to keep gas prices artificially high.”

“By dumping cheap fuel in secret trades and artificially pumping up gas prices at their branded stations, oil refiners have raked in billions of dollars in unreasonable profits at Golden State Gas pumps,” said Court.

Court spoke before the California Energy Commission’s Petroleum Market Advisory Committee (PMAC), which was created as an advisory panel to lawmakers about trends, issues and policy that impact the oil market and what consumers ultimately pay at the pump.

By the end of the year, California drivers will have paid $10 billion “extra for their gasoline,” said Court.

Officials from the California Independent Petroleum Association have said pump prices are most directly impacted by the price of oil on the international markets.

But Court said an analysis of price and consumption by Consumer Watchdog found that between February and November state drivers had already paid $9.6 billion more than their peers around the nation for gas.

Even after deducting state gasoline taxes, which are higher than most states, California drivers still paid $8.1 billion extra at the pump, or $340 per driver, from February 1 to November 30, he said in a news release.

Court said Los Angeles area drivers are currently paying 75 cents more than the average U.S. gas prices, while Californians overall are paying 65 cents more.

At $2.69 on average for a gallon of unleaded regular, California had the second-highest gas prices in the nation, lower only than Hawaii.

Nevada was next at $2.49 a gallon, followed by Washington, at $2.41 a gallon, and Alaska, at $2.36 a gallon, according to

The cheapest gas in the country Wednesday was in Missouri, where drivers are paying $1.76 per gallon on average, followed by Oklahoma and Kansas, where prices were lower by less than a penny.

Meanwhile, in California, the state's three state's largest refiners, Tesoro, Valero & Chevron, realized record profits during the third quarter of 2015, said Court.

Tesoro quadrupled its profits over the same quarter last year, while Valero made 12 times more, the nonprofit said.

Among other measures, Consumer Watchdog officials recommended to PMAC on Wednesday that state lawmakers demand more transparency from the oil industry, including publicly disclosing “all deals over 2,500 barrels, eliminating back-door 'dark market' deals.”

“If all market players have the same information, the market cannot be gamed,” said Consumer Watchdog researcher Cody Rosenfield.

Exactly a year ago Wednesday, the nonprofit consumer advocacy organization headquartered on Ocean Park Boulevard in Santa Monica warned that the oil industry planned to use its control over the market to “artificially inflate gasoline prices” ("Santa Monica Consumer Watchdog Warns Against Gas Price Increase," December 16, 2014).

According the California Energy Commission, gas prices in the state started low, at $2.67 a gallon on average, in January of this year, but spiked to $3.41 a gallon in March before peaking at $3.89 in July.

At the end of September, when the price of oil collapsed in the stock market, the price fell to $2.99 and has fallen steadily since.

Also exactly one year ago Wednesday, PMAC held its first meeting. At the time, the average price of gas in the state was around $2.89 a gallon for regular, about 19 cents below the $2.69 state average on Wednesday.

The five-member PMAC is made up mostly of university based economic experts but also includes a senior assistant from the state Attorney General's office. The panel was charged with providing additional input for lawmakers on the state's often-volatile oil markets.

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