Editorial: Price gouging isn't causing high gas prices

Bad things happen when progressive politicians attempt to solve nonexistent problems. Consider gasoline prices in California.

In 2023, California Gov. Gavin Newsom signed a bill he claimed would stop price gouging by oil companies. In 2022, average gas prices in California topped $6 per gallon. Because Nevada receives around 88 percent of its gasoline from California, prices here exceeded $5 per gallon during various times in 2022. Newsom took a high-profile victory lap over the legislation.

"California took on Big Oil and won," Newsom said. "We're not only protecting families, we're also loosening the vise grip Big Oil has had on our politics for the last 100 years."

Given California's environmental regulations, high taxes and anti-fossil fuel policies, it's amusing to see someone claim "Big Oil" has been running the Golden State. But this legislation was supposed to create a watchdog group to identify price gouging and penalize companies that engaged in it.

Over the past two months, the war with Iran caused gas prices to spike. Average prices in California approached $6 a gallon. In Nevada, average prices have hovered above $4.90 a gallon. Both of these prices are well above the U.S. average, which is around $4 a gallon.

But it turns out that - surprise! - the reason California's gas prices are so much higher than the rest of the country isn't price gouging but terrible policy.

A recent CBS News investigation found that California's gasoline costs more because of "higher taxes, labor and business costs, combined with environmental programs, regulations and the state's unique fuel blend." It found "55% of each gallon of gas includes California-specific costs."

California's hostility to fossil fuels has led to refinery closures. The Phillips 66 Los Angeles refinery shut down in October. It had the capacity to process 139,000 barrels a day. Valero's Benicia refinery is scheduled to shut down at the end of the month. Its capacity is 145,000 barrels a day. That's a 17% reduction in the state's total refining capacity.

To make up the gap, California has increased its reliance on oil imports, a significant portion of which comes from the Middle East. Oh, the irony. To reduce carbon emissions, California has crippled its domestic oil industry. But allowing oil prices to spike too high isn't politically feasible. So it's importing foreign oil, which requires greater emissions to transport.

There is added risk if President Donald Trump doesn't subdue Iran soon. Some Asian countries have reduced their oil exports, which could send prices in California and Nevada ever higher.

California's problem isn't price gouging but economically illiterate officials enacting terrible policies.

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This story was originally published April 21, 2026 at 4:43 AM.