If you’ve filled up your tank lately and felt a pit in your stomach, you’re not alone. As of April 18, 2025, the average price of gasoline in California is $4.85 per gallon—over 52% higher than the national average of $3.16. In some counties, it’s even worse, with prices hovering around $5.87 per gallon.
A recent in-depth study from the University of Southern California confirms what many of us have suspected for years: California’s sky-high gas prices are not the result of oil company greed or some mysterious market force. They’re the result of layered state policies and regulatory mandates squeezing California families at the pump.
California is pursuing two goals at once, lowering emissions and pushing cleaner fuels, without aligning the necessary infrastructure, pricing strategies, or supply chains to support them. The result is a patchwork of overlapping rules that drive up costs at every step. Refineries must produce a special fuel blend called CARBOB (California Reformulated Gasoline Blendstock for Oxygenate Blending), which is more expensive to make and difficult to source from outside the state. On top of that, Cap and Trade fees, underground tank storage requirements, seasonal fuel blend mandates, and a variety of local sales taxes pile onto every gallon sold, steadily increasing prices for consumers.
The pressure doesn’t stop there. New laws like SBX2-1 empower the California Energy Commission to penalize refiners for earning what the state considers “excessive” profits, even though some refineries have operated at a loss (as highlighted in the study). ABX1-2 adds even more costs by requiring refiners to stockpile finished gasoline, raising expenses tied to storage, compliance, and logistics. It also created a new Division of Petroleum Market Oversight, adding another layer of regulation on an already heavily burdened system. These policies, while well intentioned, have created a state-inflicted affordability crisis, one that working Californians are forced to pay for every time they fill their tank.
According to the study, $1.64 of every gallon we pay at the pump goes directly to taxes, fees, and state-imposed costs. That includes:
- $0.596 in state excise tax (the highest in the country)
- Cap and Trade charges adding $0.30 per gallon
- A required special fuel blend CARBOB, tacking on $0.12 to $0.17
- Seasonal blend requirements that cost an additional $0.13 to $0.15
And this doesn’t include sales taxes, storage fees, or environmental program costs. Meanwhile, some refineries have operated at a loss—as much as $0.14 per gallon—debunking the idea that oil companies are lining their pockets with profits.
These burdens are hardest on families already dealing with California’s high cost of living. We rank third in unemployment and second in housing costs, with the median home price around $866,000. Yet Sacramento continues to implement policies that increase gas prices and limit supply, all while signaling that gasoline itself is unwelcome in our future.
The study shows that California now imports over 60% of its oil from foreign countries, a dramatic jump from just 5.6% in 1982. While the rest of the U.S. has reduced its dependence on foreign oil, California has gone in the opposite direction. And we’re paying for it, not just at the gas station, but in energy insecurity and increased emissions from oil tankers traveling across the globe.
Refineries are shutting down—Phillips 66 will close its Los Angeles refinery by the end of this year, eliminating 8.13% of the state’s refining capacity. This isn’t happening because demand is falling. It’s happening because current laws and regulations make it nearly impossible to operate in our state. That’s basic economics: when supply drops faster than demand, prices go up.
We must take this seriously.
In 2021, I proposed a “Gas Tax Holiday” for that fiscal year. This initiative aimed to provide taxpayers with relief by utilizing the large budget surplus at the time to fund infrastructure projects that are typically financed by the gas tax, especially as rising costs began to affect our residents.
Unfortunately, the majority party rejected my request to suspend the gas tax. Since then, prices have continued to spiral out of control.
This past October, I drafted a bill to suspend the gas tax for one year and ensure that any transportation revenue lost as a result of the suspension would be replaced by general fund dollars. However, Senate Democrats refused to allow me to introduce the bill, using political and procedural tactics to block it without any consideration.
Not willing to accept defeat, I sent a letter to Senate President Pro Tempore Mike McGuire urging the introduction of my Senate Bill during the Second Extraordinary Session. My request was ignored.
The USC study underscores the need for an open and honest discussion about how California’s layered state policies, regulatory mandates, taxes and fees contribute to these skyrocketing prices. I will continue to analyze how the state’s energy goals are contributing to our affordability crisis and will fight for transparency, accountability, and relief for every family struggling with rising fuel costs.
Rosilicie Ochoa Bogh represents California’s 19th state Senate District.
