Newsom calls special session to address gas prices
California Gov. Gavin Newsom has called the state legislature into a special session to revisit a bill that would address regulations on gas prices.
Fox – LA
Gov. Katie Hobbs says a proposal in California to rein in gas prices there could drive up costs at the pump for Arizona drivers, and she has asked fellow Democratic Gov. Gavin Newsom to reconsider his support of the plan.
Hobbs and Republican Gov. Joe Lombardo of Nevada jointly signed a letter of opposition they sent to Newsom on Tuesday.
The proposal that Newsom backs to bring down California’s highest-in-the-nation gas prices, in part by increasing refinery inventory held in the Golden State, could boost costs to drivers in Arizona and Nevada, they said.
“I urge Governor Newsom and the California legislature to reconsider this legislation that could slash Arizona’s gasoline supply, raise prices at the pump and threaten Arizona’s strong economic growth,” Hobbs said in a statement.
Offering a more critical comment, Lombardo said Nevadans should “not have to foot the bill for California’s misguided policies” that could “cause regional economic disruption.”
Lombardo, a former sheriff who was elected governor in 2022, the same year as Hobbs, called the California legislation “harmful.”
Newsom called lawmakers into a special session about a week ago to consider the policy proposal, but they have not yet begun that work. Earlier this year, a bill with the same inventory provision passed the California Senate but was killed in the state Assembly over a concern the matter was being rushed through.
Newsom has said the changes would prevent price spikes — what he dubbed “profit spikes for Big Oil” — and save California drivers hundreds of millions of dollars each year.
The Western States Petroleum Association, which represents the oil industry, opposed the proposal, saying it could drive up costs “due to new tankage and working capital costs” to hold more inventory. The association warned that California’s requirements, if enacted, could reduce supply in Arizona and Nevada.
Requiring inventory increases could reduce short-term price spikes, a report from the California Energy Commission said. But the commission’s pros and cons analysis includes what Hobbs said was a major negative for Arizonans: “If the refiners withhold stocks to maintain the minimum, it may artificially create shortages in downstream markets.”
Those shortages could in turn drive up costs in Arizona, Hobbs said. A spokesperson for Hobbs said it was too early to tell how much prices could increase.
California has the highest average price per gallon of gas in the nation at $4.73, according to AAA. The average in Arizona is $3.43, which is above the national average of $3.26 per gallon.
The average price peaked at $5.39 in Arizona in June 2022, according to AAA. And while prices are down, Arizonans are headed into the November election with inflation and high costs of living at the forefront of their minds.
Hobbs’ office said the bipartisan letter aligned with her pledges to make life more affordable for Arizonans and strengthen the state’s economy.
“I’m glad to work with Governor Lombardo on this critical issue, and hope we can come together as a region to deliver lower fuel costs to all of our constituents,” Hobbs said in the statement.
Newsom’s office pointed to a social media post on X, formerly known as Twitter, when asked to respond to the governors’ letter. The post affirms Newsom’s support of the changes and says “California refineries choosing not to backfill their supply when they go offline causes prices to spike” in all three states.
Reach reporter Stacey Barchenger at stacey.barchenger@arizonarepublic.com or 480-416-5669.
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Publish date : 2024-09-11 02:03:00
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