California Energy Commission officials are investigating whether major gas brands are charging Californians more than necessary after the conflict with Iran sent fuel prices higher.
Tai Milder is the Director of the Division of Petroleum Market Oversight for the CEC. He says officials are looking into whether major gas companies are using the recent price spike to boost profits.
"The early indicators now is that the Iran conflict is leading to much higher industry profits, but it’ll take time to really see the full impact. And what we don’t want to see if refiners, marketers, or retailers using the conflict to pad the profits at the expense of consumers."
Milder told lawmakers stations like Chevron, Shell, and Valero charge an average of 31 cents more per gallon than unbranded stations. Nationally, that gap is about 6 cents.
State tax official Gentian Droboniku says there are also signs that retail markups may be driving some of the price differences consumers see at the pump, noting that wholesale and retail prices can differ by as much as 70 percent.
"This shows that often the price variation between gas stations appear to be largely due to retail margins. If it’s costing the same, then retail margins or decisions at the retail level plays a bigger role on what folks pay at the pump."
Droboniku says the gap between California’s 100 most expensive and 100 least expensive gas stations averaged $1.76 per gallon over a 200-day period.