California Sues Energy Companies For Gas Price Gouging After Voters Nearly Revolted Over Fuel Taxes


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Chris White Tech Reporter
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  • California Attorney General Xavier Becerra sued two energy trading companies Monday for allegedly colluding to increase the state’s gas prices. 
  • Becerra’s move comes after Gov. Gavin Newsom suggested in 2019 that oil companies are responsible for high fuel prices. It also comes more than two years after voters nearly revolted over the state’s gas taxes.
  • Local activist Carl DeMaio told the Daily Caller News Foundation that Becerra and Newsom are “arsonists” who start fires and then have the “audacity to say someone else is at fault.”  

California sued two major energy companies Monday for allegedly manipulating gas prices artificially.

Energy companies Vitol Inc. and SK Energy Americas drove up gas prices through “manipulative trades,” California Attorney General Xavier Becerra said in a complaint filed Monday.

“It’s greed that hurts grandma, the Good Samaritan and everyday Americans,” Becerra said in a prepared statement. “Every once in a while we get to fight back. That’s what today’s lawsuit is about. No one is above the law.” (RELATED: Here’s Why Californians Pay Way More For Gasoline Than Everyone Else)

California Attorney General Xavier Becerra speaks at the second annual Women's March in Los Angeles, California

California Attorney General Xavier Becerra speaks at the second annual Women’s March in Los Angeles, California, U.S. January 20, 2018. REUTERS/Patrick T. Fallon

Vitol and SK Energy Americas took advantage of a market disruption after a 2015 explosion at a gasoline refinery in Los Angeles County knocked out roughly 10% of California’s gasoline supply, according to Becerra’s lawsuit.

Becerra claimed the two gasoline trading companies colluded to keep prices high, thereby violating the state’s antitrust laws. Becerra and Newsom have not responded to the DCNF’s requests for comment, nor have Vitol and SK Energy.

“High gas prices, it seems, are not the result of gas taxes or California’s efforts to protect the environment,” said Democratic state Assemblyman Marc Levine, who announced the lawsuit alongside Becerra Monday.

California Gov. Gavin Newsom asked the attorney general in 2019 to investigate oil companies for conspiring to keep gas prices artificially high.

Newsom asked for the investigation at a time when the price of a gallon of gas in California was increasing, with the average cost skyrocketing to $4.18 while drivers in other areas are paying as much as $5 per gallon, CNN Business reported in October 2019, the highest prices in the country.

Newsom’s predecessor, former Gov. Jerry Brown, signed a law in 2017 that imposed a 12-cent tax increase per gallon and raised the tax on diesel fuel by 20 cents per gallon.

California became the state with the highest gas taxes in the country in July 2019 after a variable state tax increased another 5.6 cents. California drivers are taxed 80 cents per gallon today, an ABC News affiliate in California reported in July 2019.

The coronavirus pandemic reduced the overall cost of gasoline, with the average price at $274 per gallon California as of May 5, according to figures from the American Automotive Association’s gas price website.

Some critics of California’s gas tax said Becerra is partially to blame for the high prices.

“They’re arsonists. They create a controversy and then have the audacity to say someone else is at fault,” Carl DeMaio, a San Diego activist who spearheaded the campaign to nix the gas tax, told the Daily Caller News Foundation. Becerra and his office are simply trying to shift blame here, said DeMaio.

Supporters of a failed campaign to nix California’s unpopular gas tax law during the 2018 midterm election promised to recall Becerra for supposedly misleading voters who oppose the law. They argued that his office labeled an initiative intended to repeal the law in a way that made it appear to voters that a “yes” vote would eliminate road repairs and transportation funding.

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