California’s Latest Gas Pricing Regulation Marks Another Blow to the Oil Industry

HI INDIA NEWS DESK
SACRAMENTO, CA – California Governor Gavin Newsom has signed a new law that gives state regulators the power to penalize oil companies for making excessive profits. This is the first law of its kind in the country and marks a victory for California, which was once a leading oil producer in the United States but has seen declining production in recent years as the state’s policy priorities have shifted.

The state aims to be carbon neutral by 2045 and has implemented a ban on the sale of most new gas-powered cars by 2035. The Western States Petroleum Association, a trade association for the oil and natural gas industry, spent $11.7 million lobbying lawmakers in the 2021-2022 legislative session and made campaign contributions to both Democrats and Republicans.

The bill was signed into law despite the industry’s efforts to stop it, but its influence could be felt in the final version, which was decided by a five-person panel appointed by Newsom rather than being a new tax on oil company profits, as originally proposed by Newsom. The oil industry is expected to challenge the state law that bans drilling new oil wells near homes, schools, and other sensitive areas in the coming year, with voters set to decide on the issue in 2024.